Before configuring taxes in Shopify, you need to determine whether your business is required to charge VAT (or sales tax).
There are two main scenarios:
1. Businesses that collect VAT (standard VAT regime)
If your business is registered for VAT, you need to:
Charge VAT on taxable sales
Declare and remit VAT to the tax authorities
Display VAT correctly on receipts
Enter your VAT number in Shopify
2. VAT-exempt businesses (e.g., the French "Franchise en base de TVA")
If your business benefits from a VAT exemption regime:
Don't charge VAT on sales
You can't deduct VAT on purchases
Your receipts will automatically include the required legal mention (in France: "TVA non applicable, art. 293 B du CGI.")
Don't activate VAT collection in Shopify
If you're not sure which regime applies to your business, consult your accountant or the local tax authority before you configure taxes.
Steps to configure tax collection in Shopify
If your business collects VAT, follow these steps:
In Shopify admin, go to Settings → Taxes and duties → Tax regions, and select European Union.
In the VAT collection section, click Collect VAT in an EU country.
Select France.
Enter your VAT number (example: FRXX999999999).
Click Collect VAT.
If your business is VAT-exempt, leave this section blank — you don't need to do anything here.
Important compliance note
If you're VAT-registered, you must activate VAT collection in Shopify.
If you're VAT-exempt, you must not activate VAT collection.
Your Shopify tax configuration must always match your official tax status.
Incorrect VAT configuration can result in:
Charging VAT when you're not allowed to
Failing to charge VAT when required
Non-compliant invoices or tax reports
If your VAT status changes (for example, you exceed the exemption threshold or opt into VAT), update your tax configuration in Shopify immediately.