How to Automatically Calculate Sales Tax in Squarespace Using the New Automated Tax Feature [2025]

Squarespace
Written By Christy Price
Disclaimer: This post does not contain tax advice. For any questions about sales tax, please consult with a tax professional.

Squarespace has rolled out a truly helpful update that changes the way we handle taxes on our online stores: Automated Taxes. If you’ve struggled with manual tax setup or depended on outside tools like TaxJar, this native upgrade is a welcome relief. I’ll break down what this new feature offers, why I’m excited to use it myself, and show in detail how to set it up on your own Squarespace site.

For anyone running a business online, especially in e-commerce, handling sales tax, VAT, or GST can become frustrating. That’s why automatic calculation, record-keeping, and compliance built right into Squarespace can save you hours… and a lot of headaches.

Understanding the New Automated Tax Feature in Squarespace

Squarespace’s new Automated Taxes tool means you no longer need to juggle a separate TaxJar account just to stay compliant with sales taxes. Now, tax calculation and collection are handled right within the platform.

With this feature, Squarespace automatically calculates taxes for over 90 countries and all US states. That includes VAT and GST, so you’re covered if you sell outside the US. The system supports businesses based in more than 35 countries, and you can collect remote sales taxes even if you don't have a physical presence in the customer’s country.

Key benefits:

  • Automatic updates: Tax rates update themselves as laws change, no manual editing needed.

  • Native integration: No need to use third-party apps. It’s all in your Squarespace dashboard.

  • Multi-country support: Run an international shop with peace of mind, knowing you’re charging the correct taxes everywhere you sell.

  • Simple reporting: Download detailed reports to track all transactions and tax collected.

In the past, I relied on TaxJar, a third-party extension, to get most of these features. Now, tax compliance is part of the basic Squarespace workflow, which helps cut out that additional step.

Squarespace is currently offering zero per-transaction fees for Automated Taxes during its launch promotion. If you’re considering switching, now is the perfect time to try it out.

Get more information on the details and fees (starting January 2026) in Squarespace’s official support on setting up automated tax rates.

Setting Up Automated Sales Tax in Squarespace Step-by-Step

Here’s how I quickly set up automated sales tax on my own site. Follow along to make sure you’re collecting (and remitting) the right amount from day one.

Accessing the Tax Settings in Squarespace

First, head into your Squarespace backend. Navigate to Settings > Selling > Taxes. If you’re like me, menu reorganizations can sometimes make this tricky to find. Here’s a handy shortcut: just hit the “/” key on your keyboard once you’ve logged into your site, type “Taxes” into the search box, and you’ll jump right to the relevant menu.

🎥 Quick tip: If you want a comprehensive walkthrough that expands on these steps, check out my full YouTube video where I set up sales tax on my own website: NEW Automated Tax Rates in Squarespace: Sales Tax, VAT, GST [2025]

Enabling Automated Tax Calculation

Once you’re in the Taxes section, you’ll see an option to turn on Automated Taxes. Right now, there’s a promotional price of zero per transaction fee until January 2026.

For your setup, you’ll have two options:

  • Use Stripe to sync your account information for an even quicker setup.

  • Fill in your business information manually.

I’m based in the US and run a single-member LLC, so I selected those options. Enter your legal business name and confirm your business structure accurately; this information gets reported to tax authorities.

Setting Your Tax Defaults

Next, Squarespace needs to know some basics to apply the right rules:

  • Business address: Enter the address where your business is registered.

  • Product tax codes: Assign your products the correct tax category. For most physical products, selecting tangible goods works. If you offer services or digital goods as well, stay tuned, as I’d expect Squarespace to add even more specific tax code options per offering soon. (The right code is important for charging the correct rate.)

Adding Tax Registrations and Locations

Here’s where you specify the places where you must collect sales tax.

For example, I registered to collect in Texas, so I added my Texas state sales tax details. You’ll be able to add as many states (or countries) as you’re registered to collect in.

You then decide how taxes show up for customers:

  • Added at checkout: The tax is displayed as a separate line item (my personal choice and what customers usually expect).

  • Included in sales price: The price shoppers see already includes tax.

Choose what works best for your brand and customer experience.

Exploring Additional Settings

Squarespace makes it easy to keep records accurate:

  • Tax Reporting: Download reports for any date range, so filing sales taxes gets easier.

  • Receipt Details: Some countries require tax IDs or specific price breakdowns on receipts. Double-check these settings to stay compliant in your region.

  • Business Settings: If needed, add or edit your tax registration IDs here.

  • You can always switch back to manual tax setup if the automated system doesn’t meet your needs.

For more technical help, you can dig into Squarespace’s official automated tax documentation.

Why You Should Consider Using Squarespace’s Native Automated Taxes

Here’s why I’m fully behind this move to native Automated Taxes and now recommend it to my clients:

  • No extra fees (for now) make it free to try out.

  • Automatic tax rate updates happen behind the scenes so you don’t have to worry about keeping up with them.

  • Unified, built-in reporting makes audits and record-keeping much simpler.

  • One less app to manage, keep everything inside Squarespace for a cleaner, simpler workflow.

  • As Squarespace improves this feature, you can expect ongoing updates.

I’m excited to use this on my own shop and will be recommending it for any new Squarespace site going forward to try during the free trial.

Tips and Best Practices for Managing Sales Tax with Squarespace Automated Taxes

Even with a great automation tool, tax compliance means a little ongoing attention. Here are some essential habits I recommend:

  • Update your business address and tax registration info promptly if you move or expand.

  • Assign the correct tax codes to your products and/or services.

  • Review your tax reports regularly, not just at tax time. Spot-check for errors early.

  • Fine-tune your receipt details so they meet the requirements in the countries you sell to.

  • Think ahead if you work with digital goods, services, or mixed offerings, as rules and rates may differ.

Even More Resources for Squarespace Designers

Need more support as you build or grow your Squarespace site? Here are a few resources I’ve built for you:

Christy Price

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