Introduction

In some states, delivery charges are subject to sales taxes. Depending on where your business operates, if the goods you offer are taxable, you might be obliged to apply additional fees on them.

To ensure you are in full compliance with local laws and regulations, please considering advising with a legal tax authority or professional.

In case you are required to apply sales taxes on shipping charges, in the following lines of this guide, you can find step-by-step instructions on how to configure your X-Cart store to implement such.

The configuration of a shipping tax is done in the following order:

1. Creating Tax Rates and assigning Tax Classes to them
2. Assigning Tax Classes to Shipping Methods

Crating Tax Rates

For a start, please log in to your X-Cart Admin Area and navigate through the left-hand side menu bar to Store setup > Taxes.

When there, please remain under the "Sales tax" tab opened by default.

Here, you can create the required tax rates and assign tax classes to them.

To create your first tax rate, please locate the "Tax rates on shipping cost" section and click on the "New rate" button.

Afterward, you are presented with a new row to configure the tax rate details:

• Zone - From this dropdown menu, you have to select the Zone applicable to this tax rate. If you have not yet configured your Zones, please take a moment to review our tutorial based on How to set up and manage Countries, States and Zones in X-Cart and get familiar with the concept.
• Tax class - From this dropdown menu, you need to select the Tax Class applicable to this rate. Tax classes allow you to configure different tax rates and assign them to shipping methods. In case, you have not set up your Tax Classes yet, please refer to our tutorial on How to set up Tax Classes and Tax Rates in X-Cart. Please note that if you do not have any Tax Classes configured, this field is going to be missing.
• Rate - In this field, you have to specify the percentage value of the tax rate.

When ready, please click on the "Save changes" button, and your new tax rate is going to be created.

Assigning Tax Classes to Shipping Methods

Now that your tax rates are created and configured with the appropriate tax classes, it is time to attach them to the intended shipping methods. To do that, please navigate through the left-hand side menu bar to Store setup > Shipping.

When there, please remain under the "Settings" tab opened by default.

In the Shipping Methods table, you can see a column indicated as "Tax class". Locate the required Shipping method in the list and click on the corresponding tax class value. Once it becomes editable, select the appropriate tax class from the dropdown menu.

When ready, do not forget to click on the "Save changes" button to apply them successfully.

As with any other modifications, you have to test it on the storefront. To verify the taxes are being calculated and applied correctly, please go ahead and submit a new order. When you confirm it all works are expected, you are all set.

Congratulations! You have learned how to configure sales taxes that are going to be applied to shipping costs. We hope our instructions were clear and easy to follow. In case you have run into some difficulties, please do not hesitate to contact our Support Team for further assistance.