Table of Contents
- Last Updated
- Stripe Billing
TaxJar’s integration for Stripe (beta) allows Stripe Billing users to collect, report and file sales tax.
If you’re a Stripe user who sells on multiple platforms like Amazon, Ebay, and Shopify in addition to Stripe, we recommend creating a TaxJar account and utilizing this integration.
If you’re a Stripe-only user, we recommend you explore Stripe Tax which integrates directly with Stripe Checkout, Billing, Invoicing, and Connect. Learn more about Stripe Tax.
Request access for TaxJar Integration for Stripe
TaxJar’s integration for Stripe is available by invitation-only. If you’re interested in using TaxJar’s reporting, or filing, you must request access.Request access
Sales tax is complex, with regulations changing constantly. For a primer on the basics of sales tax, including nexus, registration, filing, reporting, calculations and more, please visit Sales Tax Fundamentals. Also, be sure to take a look at our Resource Center, with articles, webinars and videos for beginners and experts alike.
|Service||Imports||TaxJar Calculations (Deprecated)||Stripe Tax|
|Stripe Billing (Subscriptions)||x||x1||x|
|Checkout in Payment Mode||x4||x|
|Checkout in Subscription Mode||x||x1||x|
|Checkout in Setup Mode2|
- TaxJar Calculations are deprecated. Use Stripe Tax instead, which also has the benefit of displaying the taxes to end-users.
- Checkout Sessions in setup mode end up creating PaymentIntents which are not supported.
- Charges and Payment Intents are supported only if they’re created by Stripe products, such as Stripe Billing or Checkout. Direct charges and payment intents are not supported.
- Checkout Session support began on 2021-09-16. Previous to this date, charges would be imported that resulted from these Checkout Sessions.
Connecting to Your Stripe Account
Once you have a Stripe account and TaxJar account, log into your TaxJar account. Navigate to Account → Linked Accounts. You will see a button to initiate an integration between your TaxJar account and your Stripe account. Click the Stripe button. If you do not see a Stripe button, you can request access to the Stripe integration.
You’ll be redirected to confirm and connect your Stripe account.
Once connected, you will return back to your TaxJar account.
Sales Tax Calculations
Sales Tax Reporting
After you link your Stripe account to TaxJar, we will be able to import all paid invoices, credit notes, and charges for you automatically. Immediately after linking, we will trigger an import to fetch recent transactions from Stripe, and we schedule regular imports to capture new and updated invoices, checkout sessions, and credit notes in your Stripe account.
Invoices have the most detail and include line items, tax rates, the customer, associated charges and credit notes.
A charge represents the movement of money, either collected from the buyer or refunded from the seller to the buyer. These charges can be associated with invoices to represent payments or refunds on that invoice. Charges may also stand alone, without being attached to an invoice.
Stripe Tax users with sales tax reporting should use Credit Notes instead
Money movement in Stripe is designed to be easy and straight-forward, but a trade-off is that charges and payment refunds can work without features such as tax calculations. Tax calculation is critical for sales tax reporting, so it's important to use Stripe features that support tax, such as invoices.
Payments made via Charges or bare Payment Intents (those not attached to invoices) do not calculate taxes, and therefore refunds to those payments also do not calculate taxes. Payment refunds do not decrease liability and therefore will not appear in TaxJar for reporting. To refund a payment, please instead issue Credit Notes which will decrease liability and will appear in TaxJar for reporting.
Please review Stripe Tax FAQs
Credit Notes issued before payment
Credit Notes that are created before the customer has paid the invoice are imported into TaxJar as discounts on orders. Since payment has not yet occurred, we interpret credit notes as discounts on the order.
Credit Notes issued after payment
Credit Notes that are created after the customer has paid the invoice are imported into TaxJar as refunds and associated with the order. Since payment has already occurred, we don’t update the original order and instead import the transaction as a refund since this refund may occur in different tax periods.
Your products may need to have product tax codes attached to them; these codes inform TaxJar how the item should be treated. For example, some products may be tax exempt or have reduced rates.
Let’s navigate to our products, and click on a product that should be classified.
To classify this product, we are going to add metadata to the product.
The key should equal product_tax_code, and the value should equal the code provided by TaxJar. In this case, it is 1411803A0001. The good news is that once the product tax codes are attached to the product, they will be applied to all invoices going forward. Be sure to double-check you’re adding the correct product tax codes.
Alternatively, you can add metadata to your charge with the key of product_tax_code and the value equaling a TaxJar product tax code.
Products are not the only entities that can be tax exempt; customers may also be tax exempt. TaxJar can handle this too! The easiest way to express this is from Stripe’s system when editing the customer’s record. Let’s navigate to a customer and mark them as tax exempt.
Once at the customer details, you can edit the customer information to classify them as tax exempt.
Find their “Tax status”, switch it to “Exempt”, and save the customer. You can now create a new invoice, attach it to the exempt customer, and verify that no taxes are attached to any line items.
If you operate within a country that has VAT (such as the EU countries), then you may want to consider Stripe’s tax status of “Reverse charge”. Depending on your situation, you may want to shift VAT reporting to the EU customer. TaxJar will treat these customers as “exempt” in your reports.
Stripe has great documentation on Testing Stripe Billing. We highly recommend you review their documentation first. When you’re ready to connect to TaxJar, please note that TaxJar will only import transactions that are in live mode. Test mode is not supported for imports.
If you have additional questions or need help integrating your Stripe and TaxJar accounts, please contact our support team.