Automatically collect tax on invoices

Learn how to automatically calculate tax on your invoices.

On an invoice, Stripe Tax calculates sales tax, VAT, and GST. To calculate these for each line item, Stripe uses:

Your tax settings
The customer’s tax settings and location
The product tax code and price tax behavior

Set up the customer

We use the customer’s location to determine the relevant taxes to collect. Customers outside of the US need at least a country-level address, while customers in the US require a 5-digit postal code. For Canada, we need at least the province or postal code.

You can add customer location information in the Customer details page by clicking Edit next to Details. To add a customer’s location from the Invoice Editor, click the overflow menu (

) next to the customer. Select Edit customer information, click Add additional details, and scroll down to Billing details.

After you update the location, click Update customer. Stripe applies the new location to all of your customer’s future invoices unless you update it. For more information, see Determine customer locations.

Set up line items

To calculate tax on each line item on an invoice, you need to set a tax behavior and optionally a tax code.

Customize tax settings for one-off line items

Customize line items in the Invoice Editor by selecting the tax behavior from the Include tax in price drop-down menu.

Customize tax settings for one-off line items

Customize tax settings for product-based line items

You can use both the Dashboard and the API to customize tax settings for product-based line items.

On the Products page, you can select both the tax behavior for a particular price and the optional tax code for the product. The tax behavior is per price. You can’t change the tax behavior after you select it, but you can create new prices or archive old ones. To set up a tax behavior, click Add a price (or Add another price if you already have one) and select it from the Tax behavior drop-down menu.

To set up a tax code, select it from the Tax code drop-down menu when you create a new product or edit the details of an existing one.

Customize tax settings for one-off line items

Enable automatic tax

After specifying a tax behavior and tax category, you can add the price to the customer as an invoice item:

curl https://api.stripe.com/v1/invoiceitems \
  -u sk_test_4eC39HqLyjWDarjtT1zdp7dc: \
  -d customer=cus_13729he8947269 \
  -d price=price_1K6mzG2eZvKYlo2CK7kcBICl

Finally, you can use the toggle in the Invoice Editor to calculate tax automatically. In the API, pass the automatic_tax field to enable or disable automatic tax calculation.

Command Line

curl https://api.stripe.com/v1/invoices \
  -u sk_test_4eC39HqLyjWDarjtT1zdp7dc
: \
  -d "customer"="cus_13729he8947269" \
  -d "automatic_tax[enabled]"="true"

To enable automatic tax calculation when you update an invoice, add the invoice parameter alongside automatic_tax:

Command Line

curl https://api.stripe.com/v1/invoices \
  -u sk_test_4eC39HqLyjWDarjtT1zdp7dc
: \
  -d "invoice"="inv_12345" \
  -d "automatic_tax[enabled]"="true"

Refunds of charges associated with an Invoice don’t reduce your overall tax liability and don’t show up in Stripe Tax reporting. Learn more about how refunds work.

In most cases, you should use credit notes instead of refunds. Credit notes reduce your overall tax liability and show up in Stripe Tax reporting. Learn more about how credit notes work.

Automatically collect tax on invoices

Set up the customer

Set up line items

Customize tax settings for one-off line items

Customize tax settings for product-based line items

Enable automatic tax

See also