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Adding Tax: Before or After Shipping?

In summary, In some states you have to tax the shipping before you add it to the cost of the order, and in other states it is added after.
PCSarahjm
701
TAX Do you add Tax before shipping or after shipping? I thought you add tax before shipping but P3 is adding Tax after shipping. Please let me know.
 
I think it depends on what state you are in... I know that in NC you have to tax the shipping but that is not the case in every state.
 
After
PCSarahjm said:
TAX Do you add Tax before shipping or after shipping? I thought you add tax before shipping but P3 is adding Tax after shipping. Please let me know.

I do it after. That's the way the order form shows it to be done. So I guess we are charging tax on shipping too.

Debbie :D
 
It's all according to your state (a few don't charge tax on shipping) and then how you have it set up on your program. You might have it set to 0%. You would want to change that or your shows will be held up until they contact you and you will be paying that tax.
 
It depends on the state you're in. It may look like it's adding it after just because of where it is on the screen. If you do the math, you should be able to check that it's doing it correctly.
 
Wow. All of us were typing at the same time.
 
  • Thread starter
  • #8
I have the tax % right for the show. But when I hosted a show my consultant had me add the tax before the $4 shipping charge. So that is what I had my host do. But when I put the items into P3 it taxed the shipping too. Which is about .25 difference. I just want to make sure I am doing the right thing for the next show.
 
On the receipt, it states that shipping is taxable in all states, except: AK, DC, DE, IA, ID, IL, MA, MT, NH, NH, OH, OK, OR, UT and WY.

So, if your show is being shipped to any state other than those listed above, you calculate tax on the total after you add the shipping. If it is one listed above, then you calculate tax on the total before you add the shipping.
 

Related to Adding Tax: Before or After Shipping?

1. When should tax be added, before or after shipping?

The general rule is that tax should be added before shipping. This means that the tax amount is calculated based on the subtotal of the order, including any applicable discounts, and then added to the total before shipping costs are applied.

2. Is it legal to add tax after shipping?

In most cases, it is not legal to add tax after shipping. This is because tax laws require that the tax amount be clearly stated and included in the total amount that the customer pays. If tax is added after shipping, it can be seen as a hidden fee and potentially lead to legal issues.

3. Can tax be added separately from shipping costs?

Yes, tax can be added separately from shipping costs. Some businesses choose to do this for transparency and clarity, as it allows customers to see exactly how much they are paying for each aspect of their order.

4. Do all states/countries have the same rules for adding tax?

No, tax laws vary by state and country. It is important to research and understand the tax laws in the specific location where your business operates in order to determine the correct way to add tax to orders.

5. How can I ensure that tax is added correctly to orders?

The best way to ensure that tax is added correctly to orders is to use a reliable and accurate tax calculation software or consult with a tax professional. This will help ensure that your business is following the correct procedures and avoiding any potential legal issues.

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