Table of Contents
- How to Set Up Taxes in Squarespace for Online Sales
- TL;DR: Key Points
- Set Up Automated Taxes (Recommended)
- How to Turn On Automated Taxes
- When to Use Manual Tax Settings
- Setting Up Manual Taxes
- How Tax Calculations Work at Checkout
- Tax-Inclusive Pricing
- How to Enable Tax-Inclusive Pricing
- Common Questions
- Key Terms
- Getting It Right
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Last Edited Time
Jun 25, 2025 09:44 PM
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automated tax rates
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AI summary
Set up taxes in Squarespace by using automated calculations for accuracy based on customer location or manual settings for flat rates. Enable tax-inclusive pricing to show final prices upfront and regularly check your tax setup for compliance.
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How to Set Up Taxes in Squarespace for Online Sales
Setting up taxes properly in Squarespace Commerce keeps you compliant and prevents checkout surprises for your customers. Here's how to handle both automated and manual tax settings.
TL;DR: Key Points
- Automated tax calculations work out the right rates based on customer location and your tax registrations
- Manual tax settings work for simple flat rates across all products
- Tax calculations use shipping, billing, or pickup addresses depending on your product type
- Tax-inclusive pricing shows customers the full price upfront, avoiding checkout surprises
Set Up Automated Taxes (Recommended)
Automated taxes calculate the correct rates based on where you're registered to collect tax and where your customer is located. This saves time and reduces mistakes, especially if you sell across multiple regions.
How to Turn On Automated Taxes
- Go to Commerce > Taxes in your Squarespace dashboard
- Add your tax registrations for each location where you need to collect tax
- Switch on automated tax calculations
- Test with a few sample orders to check everything's working
Quick tip: Automated taxes update when tax rates change, so you don't need to manually adjust rates when governments make changes.
When to Use Manual Tax Settings
Manual tax setup works best if you have a simple tax structure (like one flat rate for everything) or operate in a single jurisdiction. You'll need to stay on top of rate changes yourself.
Setting Up Manual Taxes
- Navigate to Commerce > Taxes
- Enter your tax rate as a percentage
- Choose whether to apply it to all products or specific categories
- Save and test your checkout
Keep in mind you'll need to update these rates manually when tax laws change.
How Tax Calculations Work at Checkout
Squarespace uses different addresses depending on what you're selling:
- Physical products: Uses the shipping address
- Digital downloads: Uses the billing address or postal code
- Services: Usually uses the billing address
- Local pickup: Uses your business address as the taxation address
The system picks the right address automatically based on your product type and delivery method.
Tax-Inclusive Pricing
This shows customers the final price including tax, which can reduce cart abandonment and make pricing clearer.
How to Enable Tax-Inclusive Pricing
- Go to Commerce > Taxes
- Toggle on "Display prices with tax included"
- Save your changes
Your product prices will now show the total amount customers pay, with tax calculations handled behind the scenes.
Common Questions
Can I set different tax rates for different products?
No, Squarespace applies one tax rate across your entire store. If you need product-specific rates, you might need a third-party tax service.
How do I handle tax exemptions for wholesale customers?
Squarespace doesn't have built-in tax exemption features. You'll need to handle these manually or use external tools.
Do automated tax rates update when laws change?
Yes, but it's worth checking your tax setup every few months to make sure everything's still accurate.
Key Terms
VAT (Value-Added Tax): Tax added at each stage of production, common in the UK and EU
GST (Goods and Services Tax): Similar to VAT, used in countries like Australia and Canada
Taxation Address: The address Squarespace uses to calculate tax, especially important for local pickup orders
Tax-Inclusive Pricing: Showing the final price including tax, so customers know exactly what they'll pay
Getting It Right
Start with automated taxes if you sell across different locations or online. They're more reliable and save you from manually tracking rate changes. If you have a simple setup with one tax rate, manual settings might work fine.
Either way, check your tax setup regularly and consider consulting a tax professional, especially if you're selling internationally or across multiple states. Tax rules change, and staying compliant protects your business.