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Jun 25, 2025 09:35 PM
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automated tax rates
tax management
squarespace
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Configure automated tax rates in Squarespace by enabling the feature, entering business details, registering tax regions, and choosing how to display taxes. Ensure to clear existing tax settings and seek professional tax advice before setup. Note that transaction fees for automated calculations will start in January 2026.
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How to Set Up Automated Tax Rates in Squarespace
Learn how to configure automated tax rates properly in Squarespace to handle sales tax, VAT, and GST calculations automatically.
What You Need to Know
- Automated taxes calculate rates based on your business location, customer address, and where you're registered to collect tax
- You must remove any existing tax settings from payment platforms like PayPal first
- This feature doesn't work with TaxJar or custom product tax codes
- You'll need your business registration details and tax registration information
- Choose whether to show taxes separately at checkout or include them in your prices
- New transaction fees start in January 2026
Before You Start
Get professional tax advice first. Register your business with tax authorities in all regions where you need to collect tax. This sits outside Squarespace's wheelhouse, so proper tax advice will save you headaches later.
Clear existing tax settings. Check PayPal, Stripe, or any other payment accounts you've connected. Remove any tax or shipping settings there - they'll conflict with Squarespace's automated system.
Digital products keep standard rates. Your digital products will use the default tax rate from your main product tax code. Subscription products lock in the tax rate from the original purchase, even if rates change later.
Setting Up Automated Taxes
Step 1: Enable Automated Taxes
- Go to your Taxes panel in Settings
- If you haven't set up taxes before, select "Automated" under calculation method
- If you're switching from manual rates, click "Switch to automated tax"
- If you're using TaxJar, disconnect it first, then follow the steps above
Step 2: Add Your Business Details
If you're not using Squarespace Payments, you'll need to enter:
- Your business or personal details
- Your primary tax address
Step 3: Register Your Tax Regions
- In the Taxes panel, click "Add Registrations"
- Select each location where you're registered to collect tax
- Validate each registration
Step 4: Choose How to Display Taxes
Decide whether to:
- Add taxes at checkout (customer sees product price + tax)
- Include taxes in displayed prices (customer sees final price upfront)
Important Changes Coming
From January 2026, Squarespace will charge a fee per transaction for automated tax calculations. The fee varies by plan, so check the current rates and fee caps to understand your costs.
Common Questions
Why isn't my store charging tax?
Either your setup isn't complete, or the customer's address isn't in a region where you're registered to collect tax. Double-check your registrations.
Can I use this with TaxJar?
No. You must disconnect TaxJar first - both systems can't run together.
How does it know which rate to use?
The system calculates in real-time using your registered addresses and the customer's location. Keep your registrations current for accurate calculations.
Quick Reference
Automated tax rates: Tax calculations that happen automatically at checkout based on locations and registrations
Tax registrations: Your business registration with tax authorities in different regions
Tax codes: Categories that determine how products are taxed (you can't customise these with automated taxes)
Setting up automated taxes removes the complexity of managing multiple tax rates manually. Follow these steps, keep your registrations updated, and you'll have a system that handles tax calculations properly without constant maintenance.