Platform update · Shopify
UK VAT calculations now reflect fulfillment location
For orders shipped to customers in Great Britain, VAT is calculated using the fulfillment location selected by order routing settings. Under certain conditions, VAT is not charged at checkout.
Shopify has updated how VAT is calculated on orders shipped to customers in Great Britain. The calculation now uses the fulfillment location selected for each order by your order routing settings.
How fulfillment location affects VAT
If an order totals more than £135 GBP before tax and shipping and is routed to a location outside the UK, it is treated as an import and VAT is not charged at checkout. This applies even if your store also has a UK location.
Orders of £135 GBP or less, orders shipping to Northern Ireland, and existing orders are not affected.
Options for collecting VAT at checkout
To collect VAT at checkout on these orders, update your order routing settings to assign them to a UK location, or collect duties and import taxes at checkout.
For orders shipped to Great Britain, VAT treatment depends on order routing and the selected fulfillment location.