When you start selling through Shopify, you take on not just an e-commerce platform but also a tax obligation. Shopify provides support to sellers for calculating taxes; however, it's important to remember that sellers are directly responsible for collecting, declaring, and paying taxes.

Every seller should review the tax regulations of the countries and states they operate in and act accordingly. Shopify only provides the technical infrastructure, while the responsibility for taxes lies solely with the seller.

What Are the VAT Rates on Shopify?

VAT (Value Added Tax) rates on Shopify vary depending on your country and region. In Turkey, VAT rates are generally applied at 18%, but different rates may apply to certain product categories.
To manage your VAT transactions regularly, you can follow these steps:

• Go to the "Taxes and Duties" section in your Shopify admin panel

• Register your VAT number in the system

• Customize VAT rates based on product types

• Additionally, it is recommended to consult official sources for more information about VAT exemptions in Turkey.

How to Add VAT Exemption on Shopify?

VAT exemption means certain individuals or institutions are excluded from value-added tax under specific conditions. To add VAT exemption on Shopify, follow these steps:

• Go to your Shopify Admin Panel

• Click on the Settings tab

• Navigate to the Billing section

• Under the invoice profile, in the Tax Registration section, select "Yes, I have a VAT registration"

• Enter your 10-digit Tax Identification Number (TIN) and then click the Add Tax ID button
  Once these steps are completed, you can receive a VAT exemption for your Shopify subscription. Note that only the store owner can perform this action.

E-Invoice and E-Archive Obligation for Shopify Users

Why are accounting and payment infrastructure critical for those selling with Shopify in Turkey?

For companies selling through a Shopify store in Turkey, integrating with e-Invoice and e-Archive systems has become mandatory. According to the Tax Procedure Law, businesses that exceed certain turnover thresholds are required to document their sales digitally.

This is where integration solutions like Logo, Paraşüt, and Foriba come into play. However, using these systems requires owning a financial seal or e-signature, which is only possible through establishing an official company.

Moreover, since Shopify Payments is not active in Turkey, local payment systems such as Iyzico, PayTR, and Shopier are preferred. Even when using these companies, a separate accounting record must be created for each sale. Therefore, before setting up your Shopify store, it is crucial to have a clear plan for both payment systems and e-Invoice infrastructure.

What Are the Requirements for Creating E-Invoices on Shopify?

To issue e-invoices through your Shopify store, you need to fulfill certain legal and technical steps. Below are the key points to consider for a smooth start:

• Tax Registration: You must have an active and complete tax registration. Especially if you are selling to the EU or the UK, a VAT number is also required.

• Automatic E-Invoice Settings: In your Shopify admin panel, go to the "Taxes and Duties" section and activate the automatic e-invoice creation option. With this setting, an e-invoice is automatically generated when an order is placed.

• Order Conditions
  To create an e-invoice, the following conditions must be met:

  • The order is being shipped to the EU or the UK

  • No customs duties were calculated at the time of the order

• Logo Addition: If you want to add a custom logo to your invoices, you can configure this in the system. The added logo will be automatically used on all e-invoices.

• Sending E-Invoices: Once the e-invoice is created, it can be downloaded in PDF format and sent to your customer via email.

Is It Necessary to Be a Taxpayer When Selling with Shopify?

In Turkey, individuals and organizations engaging in commercial activity through Shopify must be registered taxpayers. According to regulations by the Turkish Revenue Administration regarding e-commerce activities, all Shopify store owners exceeding a certain annual turnover must register with the tax office.

Being a taxpayer for Shopify e-commerce is not only a legal requirement but also important for the credibility of your business. Being able to provide legal documents when your customers request an invoice will enhance your brand image and increase customer satisfaction.

Do I Need to Start a Company to Open a Shopify Store?

Starting a company is not mandatory to open a Shopify store; however, in order to generate income by selling products online in Turkey, you may be required to become a taxpayer.
 

E-commerce activities by individuals without tax registration may be considered unregistered by the Revenue Administration and may be subject to penalties.

Therefore, if you plan to sell via Shopify, you must legally establish a business and become a registered taxpayer. A sole proprietorship can be a suitable and low-cost option for small-scale businesses.

How to Track and Report Taxes on Shopify?

To manage your tax operations correctly in your Shopify store, you can follow these steps:

• Adding a Tax ID: If you have a Shopify store in Turkey, VAT is added to your Shopify invoice. However, if you provide your 10-digit Tax ID number, VAT may not be added. To add your Tax ID:

  • Go to your Shopify admin panel

  • Navigate to Settings > Billing

  • Under the Billing Profile, in the Tax Registration section, select “Yes, I have a VAT registration”

  • Enter your Tax ID and click the Add Tax ID button

• Tax Reporting: Shopify Payments may report your sales to local tax authorities depending on your region. In Turkey, it's important to communicate with local tax offices to fulfill your obligations.

• Downloading Invoices: Each month, you can download invoices showing the total VAT paid for transaction fees. These invoices may be necessary for your tax return. They are generated on the 5th of each month.

• VAT and Other Taxes: To fulfill your tax obligations in Turkey, you should track VAT rates and other tax requirements. Consulting a professional accountant can be helpful.
  By following these steps, you can manage tax reporting and tracking effectively in your Shopify store.

Shopify Tax and Legal Obligations Checklist

The Importance of Getting Professional Support for Shopify Tax and VAT Requirements

Running a Shopify e-commerce business from Turkey is a complex process that requires extensive tax and legal knowledge. Proper tax planning during the Shopify website setup is the most effective way to avoid future issues.

By receiving Shopify consulting services, you can save time and maximize tax benefits. Anyone planning to open a Shopify store should fully meet their legal obligations and seek expert support when needed.