At a glance
Tax collected over time, plotted as a daily/weekly time series across the 90-day window. The pass-through liability owed to tax authorities, useful for VAT-return forecasting and sanity-checking against accounting.
Calculation
Calculated automatically from your Shopify data. See the At a glance summary above for what the metric tracks and the worked example below for a typical reading.Worked example
A UK skincare DTC brand on Shopify, VAT-registered (20% standard rate, £85k threshold), uses Shopify Tax engine. 90D window 12 Feb 26 to 12 May 26. Smoothed weekly view:
The 16.7% effective rate is the embedded VAT: for VAT-inclusive UK pricing,
totalTax = totalPrice × (20/120) ≈ 16.67%. The constant ratio across weeks confirms the tax engine is working correctly.
Six things to notice:
- Effective rate stability is the health check. Variations of more than 0.5 ppt week-over-week suggest:
- A new VAT-exempt customer cohort (B2B with valid VAT number).
- A reduced-rate product introduced (children’s clothing, books).
- Tax engine misconfiguration post-update.
- Total over 90D is your VAT return preview. £130k of tax over 90 days = ~£43k/month liability. Match against bookkeeping closing balance for sanity.
- Spring drop spike is reflected. Tax revenue scales with sales revenue. The week of 09 Mar shows a tax bump matching the sales bump; correct.
- Refund-adjusted is different. This card shows gross collected, not net liability. For VAT returns, subtract refund-tax (and recover from HMRC); fortunately Shopify’s Taxes report exposes this directly.
- Multi-currency stores split. A UK + US Shopify store will show two effective rates (UK 16.67%, US ~7-9% blended state tax). Filter by currency for a clean read; cross-jurisdiction blending is meaningless.
- Compliance signal. Persistent gaps between this card’s running total and your accounting record indicates either tax-engine misconfiguration or a sync issue between Shopify and your finance system. Reconcile monthly.
Sibling cards merchants should reference together
Tax over Time is the trend view. Companions:Reconciling against the vendor’s own dashboard
Where to look in Shopify Admin:Shopify Admin → Analytics → Reports → “Taxes” (under Finance)The most direct equivalent. Pick the same window. Tax-by-period totals should match this card. Shopify’s report can also break by tax rate (e.g. UK Standard 20%, Reduced 5%, Zero) and by region. Other Shopify Admin views:
- Reports → “Sales by billing location”: tax-by-state/region for US sales tax compliance.
- Settings → Taxes and duties: the tax-engine configuration.
- Apps: Avalara, TaxJar, Quaderno produce their own tax reports; should match this card to within sync-lag.
Cross-connector reconciliation:
Known limitations / merchant FAQs
My effective rate dropped suddenly. What happened? Three usual causes:- VAT-exempt B2B order: a wholesale customer with valid VAT number placed a large zero-tax order, dragging the average down for the day/week.
- International shift: more orders shipping to non-VAT regions (US to Asia, etc.) reduce effective rate on a UK-only-VAT store.
- Tax-engine misconfiguration: a new product type was added without VAT classification; defaulted to zero.
- Standard-rate mix shift: a new product line in a higher-rate category (e.g. luxury goods at 20% vs reduced-rate cosmetics at 0% in some jurisdictions).
- Customer-mix shift: more standard-rate domestic orders, fewer reduced-rate or exempt.
- Shopify Tax: native, included in some plans. Adequate for most DTC and basic B2B. Limited custom rules.
- Avalara / TaxJar / Quaderno: third-party, more sophisticated rules (tax-exempt customer management, multi-state US, EU OSS, custom product classifications). Often required for complex catalogues.
Order.totalTax regardless of which engine populated it; the underlying source doesn’t change the metric.
My VAT returns require quarterly figures. Can I customise the window?
Yes. The default is 90D; configure to “calendar quarter” or specific date ranges in the chart’s options. For HMRC quarterly returns, align to standard quarters (Q1 Apr-Jun, Q2 Jul-Sep, etc.).
Can I see tax-by-jurisdiction?
Not directly on this card; it’s aggregate. For per-jurisdiction breakdown, use Shopify’s Sales by billing location report or your tax-engine’s reports. Multi-jurisdiction breakdown card is on the roadmap.
My subscription store, do recurring billings show tax?
Yes. Each subscription billing creates its own tax line; appears here on the billing date. Subscription-heavy brands see a steady tax curve with predictable peaks on monthly billing days.
Action playbook for using this card:
- Monthly compliance sanity check: compare 30D total to your accounting record’s VAT closing balance. Should match within rounding.
- Effective rate monitoring: stable rate is healthy; sudden shifts deserve investigation.
- VAT registration threshold tracking: small UK stores approaching £85k VAT-registration threshold should monitor running 12-month revenue closely; this card helps confirm tax flows are correctly configured once registered.
- Tax-engine spot-check: compare a single day’s tax here to a manual recalculation (sum of order-level totalTax) to verify engine accuracy.
- Refund-aware compliance: when filing, ALWAYS subtract refund-tax from the gross figure here; otherwise you over-pay HMRC / IRS.