Best Sales Tax Apps for Shopify in 2024

If you sell on Shopify, you might incur economic sales tax nexus in multiple states requiring you to calculate, collect, file, and remit taxes in multiple jurisdictions. While Shopify Tax can help with sales tax calculation and collection – Shopify’s native sales tax solution lacks a lot of features other sales tax compliance software offers and doesn’t offer support filing, remittance, audits, or provide notifications of when you have to start collecting taxes in another jurisdiction.

Given that making a mistake on your sales taxes, like not collecting taxes in a state where you have sales tax liabilities, could lead to significant costs and penalties for your business, it’s important to have a reliable sales tax app for Shopify that supports your business with end-to-end sales tax compliance.

Shopify sellers often seek out alternative sales tax compliance solutions because they want more competitive pricing, advanced features for handling multi-state or complex tax compliance, greater adaptability with changing tax rules, the ability to handle sales taxes across multiple selling platforms, improved usability, or improved customer support

We’ll walk you through the Shopify Tax Apps that are considered the top alternatives to Shopify Tax and help you find the best sales tax app for Shopify for your business’ needs!

What is Shopify Tax?

Shopify Tax is an integrated sales tax solution created by Shopify that’s specifically designed to help merchants selling in the United States calculate and collect sales taxes in 11,000+ sales tax jurisdictions across the US.

It helps merchants with the following:

• Sales tax liability insights to help determine where you need to collect taxes
• Sales tax calculation with rooftop accuracy to ensure greater compliance
• Automatic product category suggestions
• Enhanced sales tax reports

Shopify also offers two legacy tax services that are free: Basic Tax and Manual Tax. Both offer less automated compliance support and require merchants to stay up to date on changes in tax rates and other regulatory changes. For anyone wanting a solution to calculate taxes outside the United States, they will need to access other app services for up-to-date info about local tax regulations and tax laws.

Benefits of Shopify Tax

There are a number of benefits to using Shopify Tax including:

• Easier set-up since its already integrated with Shopify
• It’s free for the first $100,000 in sales
• Only charges a maximum of $5,000 per year

Downsides of Shopify Tax

Despite those benefits, many companies don’t feel like Shopify Tax provides them with the end-to-end tax compliance service they need since the service doesn’t help them file taxes, remit taxes, or respond to audits.

Here are some of the downsides of Shopify Tax compared to other sales tax apps for Shopify:

• No sales tax nexus notifications
• No help with sales tax registration
• No address verification API
• No notifications of filing deadlines
• No help with sales tax filings
• No help with sales tax remittance
• No help with audits
• No discounts for Streamlined Sales Tax states
• Limited support
• Only U.S. tax compliance support

Types of Sales Tax Apps for Shopify

When it comes to sales tax compliance apps that you can use with Shopify there are a number of different types to choose from.

Shopify-Only vs. More Comprehensive Solutions

Some apps are made exclusively to be used on Shopify whereas others can help with sales tax compliance on other ecommerce platforms and marketplaces. Shopify-only solutions like Tax Rex and Sidr must be purchased through the Shopify App Store, whereas some more comprehensive solutions for sales taxes like TaxCloud, TaxJar, and Quaderno allow you to access their service via both the Shopify App Store and their own websites.

There are also services that aren’t available in the Shopify App Store like Avalara and Vertex but can be purchased on their website and integrated with your Shopify store and other platforms and marketplaces.

Sales Tax Filing Only vs. End-to-End Support

Some apps only provide help with understanding your sales tax obligations so you can start collecting sales tax when needed, as well as help with accurate reporting, and automated filing whereas others will help you do things like calculate and collect tax with the accurate tax rate, support you with automated filing, and even help with audits.

If you choose an app that only does sales tax reporting, you’ll need to choose another solution for managing your sales tax calculations and track your sales tax nexus yourself to know when you need to start filing in a new jurisdiction.

Best Sales Tax Apps for Shopify

1. TaxCloud

Basic Specifications: TaxCloud is a sales tax compliance service that’s focused on providing companies with end-to-end support and automation for their U.S. sales tax compliance. With 15 years experience and thousands of happy customers, TaxCloud offers the most comprehensive Shopify sales tax solution with industry leading support and pricing.

Here’s what TaxCloud offers:

• Automated order importing into TaxCloud
• Economic nexus reporting and alerts
• State registration for sales tax
• Sales tax calculation
• Automated sales tax filing
• Automated sales tax remittance
• Audit support
• Streamlined Sales Tax support
• Exemption certificate support
• Comprehensive sales tax reports
• Email, phone and chat support
• Integrations with other platforms, payment providers, and accounting software including WooCommerce, BigCommerce, Stripe, Odoo, QuickBooks Online, QuickBooks Desktop, and more
• Flexible API for custom integrations
• 30-day free trial

Reasons to Buy/Subscribe: TaxCloud has a perfect 5 out of 5 score in reviews in the Shopify App Store.

Here are some things users like:

• Most comprehensive solution
• Timely automated filings
• Helpful and responsive support
• Streamlined Sales Tax discounts
• Easy to use
• Easy setup and onboarding
• Cost-efficient: Plans cost $0 to $79 with STT filing and registration discounts, $39 filing and remittance or flat fee national, multi-state filing for just $599
• Can use with multiple ecommerce platforms and marketplaces
• API available for custom solutions

Reasons to Avoid: TaxCloud is considered the most comprehensive solution for U.S. sales tax compliance for Shopify. However, here are some reasons the app might not be right for you.

• Only supports U.S tax compliance

How it compares: TaxCloud is the most comprehensive solution for sales tax compliance for Shopify stores – and also offers industry leading customer service and pricing. Compared to solutions that only offer sales tax filing like Tax Rex and Sidr, TaxCloud gives you more features at a comparative price and represents an all-in-one solution for sales tax compliance. Unlike apps like TaxJar, TaxCloud offers responsive customer service and a U.S. based support team that helps support the success of its customers and has extras like the ability to remit sales tax and audit support. However, TaxCloud only offers U.S. sales tax compliance so sellers who sell globally might prefer a solution like Avalara or Quaderno that offers global sales tax support.

How TaxCloud grows with you: Shopify doesn’t have any solutions that file or remit your sales taxes for you, so as eCommerce businesses grow and hit nexus thresholds, they’ll eventually need to turn to expensive solutions like Avalara or Vertex to help them file sales taxes. However, TaxCloud offers a much easier and cost-effective alternative. With TaxCloud, businesses can start by using TaxCloud to monitor their nexus then start filing using TaxCloud when they first reach economic nexus in states they sell into. That ensures they avoid the complexity and cost of other platforms that provide similar services.

Why TaxCloud Free is better than Shopify Tax

Learn why TaxCloud is better than Shopify Tax.

2. Quaderno

Basic Specifications: Quaderno offers sales tax compliance support for companies selling globally.

Here is what Quaderno offers:

• Global tax nexus tracking
• Filing-ready sales tax filing
• Global tax-compliant invoicing
• Email support
• Multi-currency support
• Integrations with checkout and other platforms including WooCommerce, Amazon, Stripe, PayPal, Braintree, GoCardless, and more

Reasons to Buy/Subscribe: Quaderno doesn’t have a lot of reviews in the Shopify App Store but they have a 5 out of 5 score.

Here are some things users like:

• Reliable global tax compliance support
• Helpful and responsive support
• Easy to use invoicing
• Can use with multiple ecommerce platforms and marketplaces.

Reasons to Avoid: TaxJar is considered by many customers to be an extremely pricey solution with hard to reach support.

Here are some reasons the app might not be right for you.

• No sales tax collection or calculation. You will need another app for that
• No sales tax registration
• No automatic sales tax filing – they create filing ready returns you file yourself
• No audit support
• Complicated cost structure that adds up. They charge a monthly fee of between $49 and $149 and then charge per order for additional orders above the amount included in the plan however, all they do is help you figure out tax compliance for invoices

How it compares: Quaderno is a great solution for companies that need a global solution for sales tax compliance. It helps with sales tax nexus and sales tax filing for companies who have significant global tax complexity. However, it does not have the same functionalities as a company like TaxCloud for U.S. taxes.

3. TaxJar Sales Tax Automation

Basic Specifications: TaxJar has both a Shopify app focused on sales tax filing and a more comprehensive standalone sales tax compliance offering that can be integrated with multiple marketplaces and ecommerce platforms. This review will talk about TaxJar’s Shopify tax app. TaxJar is owned by Square.

Their Shopify app includes:

• Sales tax calculation
• Product classification
• Automated sales tax filing
• Economic nexus insights
• Simple imports
• Email support

Reasons to Buy/Subscribe: TaxJar is a popular app in the Shopify app with over 117 reviews.

Here are some things users like:

• Easy onboarding
• Sales tax calculation – meaning you’ll only need one app
• Automation of sales tax filing
• Easy to navigate interface
• Can use with multiple ecommerce platforms and marketplaces. Works with Amazon, Wal-Mart, Square, Etsy, PayPal and many other marketplaces and payment providers

Reasons to Avoid: TaxJar is considered by many customers to be an extremely pricey solution with hard to reach support.

Here are some reasons the app might not be right for you:

• No sales tax registration
• Complicated cost structure that adds up. They charge a monthly fee of between $19 and $99 and then charge $0.05 to $0.02 per order for additional orders above the amount included in the plan, between $30 to $35 per state to file, and $150 per state for sales tax registration. This is more expensive than a Shopify filing-only service like Tax Rex and more expensive than many comprehensive sales tax filing services.
• Only helps with U.S. sales taxes

How it compares: TaxJar has a comprehensive sales tax solution that helps with everything from accurate tax reports to calculation to filing and integrates with a number of different marketplaces, platforms, and payment providers. However, it charges a comparable price to TaxCloud while offering fewer features.

Read TaxJar vs. TaxCloud comparison to understand the differences.

4. Avalara

Basic Specifications: Avalara is a cloud-based software and services platform that helps automate sales tax compliance for businesses of all sizes. While the publicly traded company used to have a Shopify app, they have recently been re-focusing on providing more hands-on services to larger enterprises and shutting down services aimed at small and medium business. However, their services and software can still be integrated into Shopify.

Here is what Avalara offers:

• Global nexus tracking
• Global sales tax and VAT calculation
• Product classification
• Sales tax registration
• Global sales tax filing
• Global sales tax remittance
• Certificate management
• Integrations with ecommerce platforms, ERPs, and accounting software including WooCommerce, BigCommerce, Amazon, QuickBooks, Stripe, and more

Reasons to Buy/Subscribe: Avalara has a number of customers who think that Avalara is the right solution for them.

Here are some things users like:

• Global tax compliance support
• Additional compliance services like property tax and cross-border support
• Large number of integrations

Reasons to Avoid: Avalara sells many of its services a la carte with pricing and product suites aimed at enterprise companies.

Here are some reasons the app might not be right for you.

• Global tax support – might be more than you need
• No audit support
• Lack of transparent pricing
• A la carte pricing where each service adds additional costs
• Charges a setup fee
• No audit support

How it compares: Avalara is focused on providing premium services to global enterprises. In the last year, they shut down their Returns for Small Business (RSB) product that offered cost-effective support for sales tax returns for small businesses to focus on providing more hands-on services to larger businesses. Many customers complain about the high cost of their services. Avalara might be the right fit for a large enterprise company with complex global taxes but if your company’s sales tax situation is simpler or you’re a small or medium sized business then you’re better off choosing a cheaper alternative that offers more services like TaxCloud.

5. Vertex

Basic Specifications: Vertex is a tax technology company that offers sales tax and other business tax solutions and services to help businesses with tax compliance. While they don’t offer an app in the Shopify App store, they do offer sales tax software that can be integrated into your Shopify store.

Here is what Vertex offers:

• Economic nexus notifications
• Global sales tax and VAT calculation
• Certificate management
• Global sales tax filing
• Global sales tax remittance
• Tax reports and analytics
• Product classification
• Integrations with ecommerce platforms, ERPs, and accounting software including WooCommerce, BigCommerce, Amazon, QuickBooks, Stripe, and more.

Reasons to Buy/Subscribe: Vertex has a large number of customers who find their sales tax products helpful, particularly their Vertex 0 Series.

Here are some things users like:

• Global tax support
• Additional services like payroll tax and lodging tax

Reasons to Avoid: Vertex has a number of product lines that offer very different services for businesses at different growth stages.

Here are some reasons the app might not be right for you.

• Global support might not be needed
• Some services aren’t included in product packages or are extra
• No audit support
• No Streamlined Sales Tax discounts
• No pricing transparency – don’t list prices online
• Services are expensive and many features come at an additional cost

How it compares: Vertex offers a number of different products for global businesses of all different sizes. However, some of their products aimed at smaller businesses don’t have key features like sales tax registration or remittance. To access those features, you need to upgrade to a different plan. Vertex is a great choice for businesses selling globally but if you’re not doing so then Vertex might be more than you need. There are more comprehensive solutions for U.S. taxes like TaxCloud.

6. Taxmatic

Basic Specifications: Taxmatic is a sales tax filing service that helps with sales in Europe and the UK. Unlike other solutions that either offer just U.S. support or global support, Taxmatic provides tailored regional support for merchants who sell in the UK.

Here is what Taxmatic offers:

• Automatic VAT calculations
• Online sales tax filings for European sales orders
• Automatic remittance to EU and UK tax authorities
• Compliance dashboard
• Free VAT registrations (sales tax permit)
• Secure VAT records detention

Reasons to Buy/Subscribe: Taxmatic has great reviews in the Shopify App Store with an average review of 5 out of 5.

Here are some things users like:

• Easy setup
• Supportive onboarding
• Helpful and responsive support
• Automated VAT reporting

Reasons to Avoid: Taxmatic is a niche solution for people who need sales tax support in the UK and the EU.

Here are some reasons the app might not be right for you.

• No U.S. tax support
• No audit support
• Complicated cost structure that adds up. They charge a monthly fee of between €19 and €349 and then per transaction costs between €0.50 to €1.50

How it compares: Taxmatic offers a different solution than the other apps on this list since it focuses exclusively on UK and EU sales tax registration, calculations, and support. Taxmatic is a great solution for businesses only doing business in those regions or for companies who like their U.S. sales tax services provider and don’t want to switch to a global provider like Quaderno when expanding into other markets. However, Taxmatic is relatively expensive compared to other solutions so Quaderno might end up being the more cost efficient solution.

7. Tax Rex (Sales Tax Returns Only)

Basic Specifications: Tax Rex is a sales tax app for Shopify developed by Rexific Apps, an accounting business that develops a number Shopify apps to promote their services. Tax Rex is focused on helping businesses file U.S. state sales taxes.

They support:

• Automated sales tax filing
• Sales tax reports
• Economic nexus alerts
• State sales tax registration
• Data imports and data exports

Reasons to Buy/Subscribe: Tax Rex has a very high rating in Shopify’s App Store with reviewers giving it a perfect rating of 5 out of 5 stars.

Here are some reasons why it’s likely earned that rating:

• Complete automation of sales tax registration and filing
• Responsive team
• User-friendly

Reasons to Avoid: Tax Rex isn’t an all-in-one sales tax app but an accounting service so there are a number of reasons you might want to avoid this app.

• It doesn’t calculate and collect sales tax in Shopify. You’ll have to use another app or Shopify Tax to do your sales tax calculations.
• Complicated cost structure that adds up. They charge a monthly fee of between $5 and $10 and then charge $0.03 to $0.01 per order for additional orders above the amount included in the plan, $20 per state to file, and $99 per state for sales tax registration.
• Only helps with U.S. sales taxes
• While you can import data into Tax Rex, the app only works on Shopify

How it compares: Tax Rex is the most cost-efficient Shopify App for sales tax filing in the Shopify App marketplace. It’s much cheaper than Sidr with more functionalities since Tax Rex offers nexus alerts where Sidr only offers a nexus dashboard where you need to track your nexus status yourself. However, for the price of Tax Rex’s services, you’re likely better off getting a comprehensive sales tax solution like TaxCloud that provides you all the services you need.

8. Sidr Tax (Sales Tax Returns Only)

Basic Specifications: Sidr Tax is a sales tax compliance app for Shopify that offers automated sales tax filing for Shopify customers. It’s run by an accounting firm and only focuses on sales tax returns.

Their app includes:

• Automated sales tax filing
• Economic nexus dashboard
• Sales tax reports
• State registration
• Support

Reasons to Buy/Subscribe: Sidr has a 5 out of 5 rating in Shopify’s App Store.

Here are some things users like:

• Helpful onboarding
• Automation of sales tax filing
• Friendly and responsive  customer service
• User-friendly

Reasons to Avoid: Sidr doesn’t offer a comprehensive suite of features for end-to-end sales tax compliance and is just an accounting service that files sales tax returns.

Here are some reasons the app might not be right for you.

• No sales tax calculation or collection. You’ll have to use a second app or Shopify Tax
• It doesn’t provide nexus notifications – just a dashboard you can monitor yourself
• Complicated cost structure that adds up. They charge a monthly fee of between $19 and $89 and then charge $0.05 to $0.02 per order for additional orders above the amount included in the plan, between $25 to $25 per state to file, and $150 per state for sales tax registration. This is more expensive than a Shopify filing-only service like Tax Rex and more expensive than many comprehensive sales tax filing services.
• Only helps with U.S. sales taxes
• No data import to track sales across other apps

How it compares: While Sidr has a great service with responsive customer service and a user-friendly interface, they offer very similar services to what Tax Rex offers – for a much higher price. If all you need is sales tax filing then Tax Rex is likely the better solution but if you need comprehensive sales tax support, you’re better off choosing TaxCloud since they have the most features.

Best Sales Tax Compliance Apps

Ultimately, which option is the best sales tax app for Shopify for your business depends on your particular needs, what features you’re looking for, your budget, the size of your business, and how much automation you want from a Shopify tax app provider.

Based on the above reviews and analysis, we recommend the following as the best sales tax apps for different categories.

• Best sales tax app for Shopify overall: TaxCloud
• Best sales tax app for Shopify – global businesses: Quaderno
• Best sales tax app for Shopify – automatic filing only: Tax Rex
  • Runner up: Sidr
• Best sales tax app for Shopify – UK and EU: Taxmatic

Choose the right solution based on your growth stage

While there are multiple solutions on the market for sales tax compliance, it’s critical that you choose the right one for you since choosing the wrong solution could cost you more in product fees or staff time for solutions that don’t support end-to-end automation.

For example, if you’re a small to medium sized business you don’t need to choose an expensive global compliance solution like Avalara or Vertex that is more focused on helping multimillion-dollar enterprise businesses dealing with complex products or international taxes and VAT.

Also, it’s important to recognize that platforms like Tax Rex and Sidr are essentially accounting firms focused on filing sales tax – with very limited functionality compared to an end-to-end sales tax compliance solution like TaxCloud.

TaxCloud is a great solution for businesses of all sizes because it has a free plan to help with very basic sales tax requirements like tracking nexus and filing taxes in your home state – but it can expand as your business does to provide you with all the services you need including sales tax filing and audit support. That makes TaxCloud the sales tax compliance solution for Shopify that grows with your business.

Looking for a reliable solution to manage sales tax for your Shopify store? Start a free 30-day trial of TaxCloud today and simplify your sales tax compliance!