TaxCloud vs. Shopify Tax: Just Sales Tax Calculation — or End-to-End Compliance?
While Shopify Tax has introduced automated sales tax filing, TaxCloud offers a more comprehensive sales tax compliance solution. This includes not only automated filing but also nexus notifications, audit support, and seamless integration across all your digital storefronts.
Shopify Tax
TaxCloud incl. Shopify integration
Starter (or Premium)
Up to max of $5,000/year
From $199 to $799/annually
Free for first $100,000 in sales 0.25%-0.35% after
Starter up to 1,200 (or Premium up to 2,400)
Feature Comparison
Shopify Tax
TaxCloud incl. Shopify integration
Starter (or Premium)
$39/filing
$599/month
Starting $99/month
Why TaxCloud?
Nexus monitoring
TaxCloud consolidates your sales across all platforms at no extra cost to track economic nexus and notify you when you reach the nexus threshold for a state. In contrast, Shopify Tax only allows manual nexus checks and charges you for every transaction you import into their platform from other platforms at the same 0.25% to 0.35% price they charge for transactions on their platform.
Accurate sales tax calculation
Keeping up with tax laws can be daunting. TaxCloud’s Government Affairs team stays on top of all tax changes so the accurate sales tax amount is charged every time across all 13,000+ U.S. tax jurisdictions. TaxCloud also offers up-to-date and accurate tax codes (TIC) so that your products are taxed at the right amount every time.
No more manual adjustments for reporting
TaxCloud automates many aspects of sales tax, including calculation and collection, and our system will prepare and review sales tax reports for you. This means you won’t have to make any manual adjustments, such as prepayments, prior payments, retail delivery fees, or specifying an adjustment value.
What you get with TaxCloud
Automatic sales tax filing
Remaining tax compliant can be a full-time job. While Shopify Tax now offers automated sales tax filing, TaxCloud provides a more comprehensive, end-to-end compliance solution. Beyond tax calculation and filing, we help you track economic nexus, manage exemptions, and integrate seamlessly with all your sales channels. We ensure you’re informed about filing deadlines—and can even file your sales taxes for you—protecting you from costly mistakes!
Effortless state registration
Get simplified new state registration for compliance with TaxCloud. TaxCloud doesn’t just monitor sales tax nexus and alert you when you need to register in a new state, we also can complete the registration for you. Shopify Tax only tracks your sales tax nexus status and leaves the rest for you to do manually.
SST Certified Service Provider
Streamlined Sales Tax (SST) is a program that streamlines sales and use tax collection and administration in the program’s 24 member states. Because TaxCloud is a Certified Service Provider (CSP), we can help with registering, calculating, and filing taxes in these states free-of-charge.
Chat and phone support on all tiers
TaxCloud’s friendly, accessible, and expert customer support always has an answer to your sales tax questions. TaxCloud even assigns every customer a dedicated customer success rep to guide them through their TaxCloud journey – making TaxCloud the more hands-on alternative to Shopify Tax.
Simplify your sales tax management
TaxCloud provides end-to-end sales tax automation. That’s well-beyond Shopify Tax’s simple sales tax calculation. With TaxCloud, you can:
- Determine sales and use tax in real-time for 13,000 U.S. tax jurisdictions
- Get alerted when nexus is triggered
- Stay informed about tax exemptions and sales tax holidays
- Instantly survey sales tax order data
- Receive assistance with audits
Frequently asked questions
Shopify Tax is a sales tax calculation and collection solution that’s natively integrated into the Shopify platform. While Shopify Tax now includes automated sales tax filing, it lacks advanced compliance features such as real-time API capabilities, economic nexus tracking, and audit support. Additionally, since it only works within Shopify, it may not be ideal for businesses selling across multiple platforms.
In contrast, TaxCloud automates the entire sales tax compliance process—including filing, remittance, and audit support—across all your sales channels. TaxCloud also offers a suite of basic and premium API integrations to connect your sales tax data with your e-commerce platforms, ERPs, accounting software, and payment processors, ensuring a seamless and scalable compliance experience.
Shopify Tax now includes automated sales tax filing for certain states, but its offerings remain focused primarily on sales tax calculation and collection. Businesses selling in states not covered by Shopify’s automated filing still need to download their sales tax data and either file manually or hire a tax professional to handle their returns. Additionally, Shopify Tax lacks audit support and advanced reporting tools for multi-state compliance.
In contrast, TaxCloud provides fully automated filing and remittance for all states, with comprehensive compliance support, including audit assistance and nexus tracking. Pricing starts at just $39 per state per month or $599 for nationwide filing, ensuring cost-effective, hassle-free compliance as your business grows.
TaxCloud is more reliable because it uses an API for address verification and real-time sales tax calculation across all your sales channels. Unlike Shopify Tax, which is limited to the Shopify ecosystem, TaxCloud provides advanced compliance features, including economic nexus tracking and audit support. Additionally, TaxCloud automates sales tax filing and remittance, ensuring accurate and timely returns for every state where you have tax obligations.
Shopify Tax does not provide training on its tax offering. In contrast, TaxCloud has a dedicated onboarding team, support materials, comprehensive documentation, and a customer success team able to provide training and answer questions.
Shopify Tax provides a solid foundation for businesses starting their e-commerce journey. As your business scales and your tax compliance needs become more complex, partnering with TaxCloud ensures access to advanced functionalities such as detailed jurisdictional reporting, economic nexus monitoring, and seamless integration across multiple e-commerce platforms. This partnership offers a more robust and integrated experience, allowing your business to navigate the complexities of sales tax compliance confidently.