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Configure Square Online VAT

DISCLAIMER: Tax compliance is your responsibility. We do not guarantee the applicability or accuracy of our tax tools. If you have any questions about your tax obligations, you should consult a professional tax advisor.

To set up taxes for Square Online:

  1. Open the Square Online Overview page.

  2. Select Settings > Taxes.

The amount of VAT charged on an online purchase is determined by applying the tax rate to the total price of taxable items in an order. Optionally, you can include tax in the item price, charge tax on shipping and delivery fees and use itemised tax rates for collection and delivery orders.

Note: Tax settings from your Square account do not sync to Square Online. You’ll need to set up taxes specifically for online purchases in the Square Online Overview page .

Add A Tax Rate

By default, items added to your shop are set to the VAT settings set in your Square Online Overview page. To set up tax rates for Square Online orders:

  1. Open the Square Online Overview page.

  2. Select Settings > Taxes.

  3. Use the Add Tax Rate button to create tax rates depending on region.

Tax Exempt Items

You can exempt an item from taxes in Square Online:

  1. Go to the Square Online Overview page.

  2. Select Items > Item Library

  3. Tick off any items you want to exempt from VAT then click the “. . .” button in the upper right.

  4. Select Remove VAT.

Make sure you have selected only items that are not subject to VAT. For example, in some provinces and territories, items considered necessities are not taxed. If in doubt, consult a tax advisor.

Include Tax in Item Prices

When VAT is included with item prices, tax is treated as something that the shop owner will need to pay, rather than the customer. VAT is displayed on order receipts but not added to the total price.

To include tax in prices:

  1. Go to the Square Online Overview page.

  2. Go to Settings > Taxes.

  3. In the Tax Calculations area, tick the box for Taxes are included in item prices.

Charge Tax on Shipping or Delivery Fees

Rules for charging VAT on shipping and delivery vary from province to province. If you’re not sure what’s required, you should consult with a professional.

To turn on VAT for shipping or delivery:

  1. Open the Square Online Overview page.

  2. Select Settings > Taxes.

  3. In the Tax Calculations area, click the tick boxes to turn on taxes for shipping and delivery.

Itemised Taxes

You can use the itemised tax rates in your online Square Dashboard for collection and delivery orders. Delivery orders will still use the tax rates set in the Square Online Overview page settings. To turn on itemised taxes for collection and delivery orders:

  1. Open the Square Online Overview page.

  2. Select Settings > Taxes

  3. Under Tax rates & calculations, toggle on the itemised taxes options you want to use.

  4. Use the Go To Item Taxes button to view further details about itemised taxes in the online Square Dashboard.

Customers who received an itemised rate on a delivery or collection order can view a calculation of their taxes during checkout, displayed by tax name. If a customer selects collection or delivery for an item that does not have an itemised tax rate, no tax will be applied to the purchase. Tax exempt items in Square only apply to Square Online collection or delivery orders, delivered orders will use the tax rates set in the Square Online Overview page settings.

Add Physical Store Locations

If you are located in the United States and plan to use the automatic tax calculator, you need to account for all locations where your company has a presence. The tax setup page is pre-filled with locations synced from your Square account. If you need to enter a new address:

  1. Open the Square Online Overview page.

  2. Go to Settings > Taxes

  3. Click the Add Store Address button. 

  4. Add in the Address location details and Save when finished

Follow the same steps to add any other locations where your company has a presence, including any location that you deliver from. It is best to consult with a tax professional if you have questions.