Tax Definitions and Calculations

• U.S. Indirect Taxes (Sales Tax)
• Non-U.S. Indirect Taxes (VAT/GST)
  • Canada
  • United Kingdom (UK)
  • European Union (EU)
  • Australia
  • New Zealand
  • Norway
  • Singapore
• Frequently Asked Questions

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Merchants that activate Tax Settings are able to indicate the jurisdictions where they have obligations to remit indirect tax (e.g. sales tax, Goods and Services Tax (GST) and Value Added Tax (VAT)) on sales in Canada, the United Kingdom (UK), the European Union (EU), Australia and Singapore. Please see further below for discussions regarding specific jurisdictions. 

The estimated indirect tax remittance amounts for applicable Canada, UK, EU, Norway and Singapore orders are collected from customers, and included in the merchant’s next scheduled payment (subject to Payment Eligibility terms). Merchants may view the estimated indirect tax remittance amounts for applicable orders in their Order History, Order Details pages, and payment invoices.

Merchants are ultimately responsible for correctly identifying their filing obligations in Tax Settings and ensuring their indirect tax compliance obligations are met and returns are accurately submitted. By using Tax Settings, you acknowledge that it is offered as-is and agree that Wish shall not be responsible for, and expressly disclaims any warranties, representations, or liability regarding, any malfunctions, interruptions, errors, network or system outages, or otherwise arising out of or in any way related to your use of Tax Settings.

Note that Tax Settings also allows merchants to generate tax reports for these applicable transactions within an indicated date range.

In this article, we walk through some tax definitions and how Wish calculates taxes for different jurisdictions. You should also check out how to activate and edit Tax Settings as well as review the Wish Merchant Tax Policy.

U.S. Indirect Taxes (Sales Tax)

As of January 1, 2023, all states that impose sales tax have enacted “Marketplace Facilitator” rules, which require marketplace facilitators, such as Wish, to collect and remit sales tax on behalf of marketplace sellers if certain requirements or thresholds are met. Consequently, Wish collects sales tax and remit to the state on behalf of all Merchants that make sales into that particular state. Merchants that make sales through the Wish marketplace are not required to collect and remit sales tax on their sales made through the Wish marketplace in the U.S.

Please refer to Wish Merchant Tax Policy for a list of jurisdictions that Wish collects and remits sales tax for in-state sales occurring on its marketplace.

Non-U.S. Indirect Taxes (VAT/GST)

Canada

Tax terms in Canada

• Provincial Sales Taxes (PST), levied by the provinces
• Goods and Services Tax (GST)/Harmonized Sales Tax (HST), a value-added tax levied by the federal government
• Quebec Sales Tax (QST), levied by Revenue Quebec the federal government

For merchants shipping Canada-bound orders from outside of Canada:

Where merchants do not elect to use Tax Settings in Canada (i.e., no GST/HST/PST/QST numbers are provided), Canadian taxes are not collected by Wish, with the exception of sales to customers in Manitoba and Saskatchewan where PST (but not GST) is collected and remitted by Wish.  

Where merchants elect to use Tax Settings in Canada (i.e., GST/HST/PST/QST numbers are provided), Canadian taxes are collected by Wish on behalf of merchants separately from product and shipping prices. Merchants receive these Canadian tax amounts as part of the normal payments process (less any refunds/deductions).

Many different factors affect the amount of tax on a sale. Such as whether a product qualifies for a zero or reduced rate or where the sale takes place.

Example 1: A merchant without Federal GST and Manitoba PST numbers sells to a customer in Manitoba a 10 CAD item.

	Calculation	Total
Sales Price	10	CAD 10.00
PST Charged	10 x 7%	CAD 0.70
Total Invoice Amount	10 + 0.70	CAD 10.70

This is shown on the invoice as:

Item……………….....…CAD 10.00

Taxes…………………...CAD 0.70

Order total…………….CAD 10.70

Example 2: A merchant with Federal GST and British Columbia PST numbers sells to a customer in British Columbia and the customer purchases a 10 CAD item.

	Calculation	Total
Sales Price	10	CAD 10.00
GST/PST Calculation	10 x 12%	CAD 1.20
Total Invoice Amount	8.93 + 1.07	CAD 11.20

This is shown on the invoice as:

Item……………………...CAD 10.00

Taxes…………………….CAD 1.20

Order total……………..CAD 11.20

For merchants shipping intra-Canada orders (from and to Canada):

Wish must collect GST/HST (federal) registration numbers from merchants shipping goods from Canada to Canadian customers. Wish requires merchants to update their Tax Settings in Canada. This is a required self-serve option on Merchant Dashboard that enables merchants to provide valid GST/HST (federal) and PST/QST registration numbers.

Once merchants set Tax Settings for Canada, Wish collects Canadian taxes on behalf of merchants separately from product and shipping prices. Merchants receive these Canadian tax amounts as part of the normal payments process (less any refunds/deductions and ​​subject to Payment Eligibility terms) to remit to the authorities.

Please see an overview below with applicable sales tax in the provinces of Canada.

Alberta	GST		5%		5%	Tax settings enabled (merchant holds Canada GST registration): calculate GST (merchant remits GST) Tax settings disabled: no tax calculated
British Columbia	GST * PST		5%		12%	Tax settings enabled (merchant holds Canada GST registration): calculate GST only (merchant remits GST) Tax settings enabled (merchant holds Canada GST and BC PST registrations): calculate GST and PST (merchant remits both GST and PST) Tax settings disabled: no tax calculated
Manitoba	GST * PST		5%		12%	Tax settings enabled (merchant holds Canada GST registration): calculate GST and PST (merchant remits GST and Wish remits PST) Tax settings disabled: calculate PST only (Wish remit)
New Brunswick	HST			15%	15%	Tax settings enabled (merchant holds Canada GST registration): calculate HST (merchant remits HST) Tax settings disabled: no tax calculated
Newfoundland and Labrador	HST			15%	15%	Tax settings enabled (merchant holds Canada GST registration): calculate HST (merchant remits HST) Tax settings disabled: no tax calculated
Northwest Territories	GST		5%		5%	Tax settings enabled (merchant holds Canada GST registration): calculate GST (merchant remits GST) Tax settings disabled: no tax calculated
Nova Scotia	HST			15%	15%	Tax settings enabled (merchant holds Canada GST registration): calculate HST (merchant remits HST) Tax settings disabled: no tax calculated
Nunavut	GST		5%		5%	Tax settings enabled (merchant holds Canada GST registration): calculate GST (merchant remits GST) Tax settings disabled: no tax calculated
Ontario	HST			13%	13%	Tax settings enabled (merchant holds Canada GST registration): calculate HST  (merchant remits HST) Tax settings disabled: no tax calculated
Prince Edward Island	HST			15%	15%	Tax settings enabled (merchant holds Canada GST registration): calculate HST  (merchant remits HST) Tax settings disabled: no tax calculated
Quebec	GST * QST	9.975%	5%		14.975%	Tax settings enabled (merchant holds Canada GST registration): calculate GST only (merchant remits GST) Tax settings enabled (merchant holds Canada GST and Quebec QST registrations): calculate GST and QST (merchant remits both GST and QST) Tax settings disabled: no tax calculated
Saskatchewan	GST * PST	6%	5%		5%	Tax settings enabled (merchant holds Canada GST registration): calculate GST and PST (merchant remits GST and Wish remits PST) Tax settings disabled: calculate PST only (Wish remit)
Yukon	GST		5%		5%	Tax settings enabled (merchant holds Canada GST registration): calculate GST (merchant remits GST) Tax settings disabled: no tax calculated

Frequently Asked Questions

1. A merchant sells goods to customers located in Canada and ships the goods from Canada. Is the merchant required to remit GST/HST/PST/QST? 

Yes, this merchant is responsible for remitting GST/HST/PST/QST. (Exceptions: Saskatchewan and Manitoba PST are excluded from this because Wish will make the remittance on behalf of the merchant.)  This merchant should register for GST/HST with the Canada Revenue Agency.  

2. A Canadian domiciled merchant sells goods to customers located in Canada and ships the goods from Canada but has no GST/HST registration as the merchant is considered small business (i.e., under the CAD 30,000 annual worldwide revenue threshold). Is the merchant allowed to sell on Wish? 

Without a valid GST/HST registration number, Wish does not allow merchants to sell goods to Canadian consumers that are shipped from within Canada. Please obtain your GST/HST registration number or consult with your tax advisors.

3. A merchant ships goods from Quebec to customers in Quebec. Is the merchant required to remit QST? 

Yes, this merchant is responsible for remitting QST and should register for QST with Revenue Quebec. In this case, the total tax on an order shipped from Quebec to customers located in Quebec is 14.975%. 

4. A merchant, who has not enabled Tax Settings by providing its Canada GST number, ships goods from Canada to customers located in Saskatchewan. Is Wish remitting GST and PST? 

Although Wish is a marketplace facilitator for the Canadian province Saskatchewan, because the merchant did not enable Tax Settings, Wish calculates and remits PST (6%), but not the GST. 

 

United Kingdom (UK)

Wish automatically adds VAT for all UK orders on top of the customer-paid product price and shipping price, with the exception where a UK-domiciled merchant indicates in Tax Settings that it does not have VAT obligations (see Exceptions below). Please ensure that your product prices and shipping prices do not include the VAT amount. 

Exceptions: The merchants with low sales volume may be excluded from VAT collection (see UK.GOV VAT for more information). Eligible merchants can manage this in the Merchant Dashboard Tax Settings.

For orders shipping to the UK from the UK (i.e., orders shipped within the UK):

For non-UK domiciled merchants shipping orders within the UK, Wish calculates, collects, and remits VAT directly to the UK tax authorities.

For UK domiciled merchants shipping within the UK that have set up Tax Settings (Merchant Dashboard > Settings > Taxes), the collected VAT amounts are remitted to the merchants to remit to the UK tax authorities. 

UK domiciled merchants shipping within the UK are strongly encouraged to set up UK Tax Settings to comply with UK tax policy and to have their VAT amounts remitted to them. UK Tax Settings are available to UK domiciled merchants shipping within the UK, via our Tax Settings page in the Merchant Dashboard. Failure to properly set up UK Tax Settings results in Wish adding VAT to the merchant’s UK-bound orders and remitting directly to the UK tax authorities on behalf of the merchant for all UK-bound orders. Please note that once VAT is remitted by Wish to the UK tax authorities, there is no option for a refund from Wish. UK domiciled merchants are ultimately responsible for any VAT due in the UK.

For orders shipping to the UK from outside of the UK: 

• If the customer-paid price of the consignment is less than or equal to £135 (excluding all other customer payments such as shipping, insurance, and taxes), Wish calculates, collects, and remits VAT directly to the UK tax authorities.
• If the customer-paid price of the consignment is greater than £135 (excluding all other customer payments such as shipping, insurance, and taxes), the VAT is calculated and collected by Wish. Wish then remits the VAT amount to merchants (when merchants receive payments for relevant orders) and requires merchants to forward the VAT amount to the freight forwarder responsible for the shipment. The freight forwarder then pays the VAT amount to the customs at the border on behalf of the customers.

The price displayed to buyers at checkout is inclusive of VAT (i.e., there is no separate tax line displayed to the customer).

Example of UK VAT calculation:

	Calculation	Total
Sales Price	10	GBP 10.00
VAT Calculation	10 x 20%	GBP 2.00
Total Invoice Amount	10 + 2	GBP 12.00

This is shown on the invoice at checkout:

Item (VAT inclusive) …………………….. GBP 12

 

European Union (EU)

The EU consists of the following countries: Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.

For orders shipping to the EU from outside of the EU:

• If an order’s customer-paid price of the corresponding consignment is less than or equal to €150 (excluding shipping and taxes), Wish calculates, collects, and remits VAT to the EU tax authorities. Therefore, please ensure that the product prices and shipping prices you provide do not  include the VAT amount. This VAT is declared and paid via Wish’s Import One-Stop Shop (IOSS). Read more on the IOSS. 
• If an order’s customer-paid product price for the corresponding consignment is greater than €150 (excluding shipping and taxes), Wish calculates and collects VAT, and passes the VAT amount to the merchant when the merchant receives payments for this order. Therefore, please ensure that the product prices and shipping prices you provide do not include the VAT amount. VAT amount for these orders must be remitted to customs by merchants. As the shipment should arrive at the customer’s location as Delivered Duty Paid (DDP), please coordinate with the freight forwarder on how import VAT and customs duties are handled on your behalf.

For orders shipping to the EU from the EU (i.e., orders shipped within the EU):

• If you are shipping orders within the EU, it is important for Wish to know if you are an EU domiciled merchant or non-EU domiciled merchant with an EU establishment in order to determine your VAT obligation. Non-EU domiciled merchants with an EU establishment have the same EU VAT obligations as EU domiciled merchants for orders shipped within the EU.
• EU merchants shipping refurbished goods within the UK and EU must adhere to refurbished guidelines and VAT margin schemes, which differ from products in new condition.
• EU domiciled merchants and non-EU domiciled merchants with an EU establishment shipping orders within the EU are ultimately responsible for remitting VAT to the EU tax authorities. Merchant options to calculate and collect VAT for intra-EU orders are based on whether they choose to set or not set Tax Settings in the Merchant Dashboard: 

• • Merchants who do set Tax Settings: Once Tax Settings for EU destination countries has been set, reviewed, and verified, Wish calculates and collects VAT for intra-EU orders based on the country of arrival of the goods (regardless of the EU-wide distance sales threshold of €10,000, meaning that VAT at country of origin will not be applied) and passes the VAT amount to merchants to remit to the tax authorities. If merchants choose to set up Tax Settings, they need to ensure that the product price and shipping price provided do not already include the VAT amount.
  • Merchants who do not set Tax Settings: These merchants are responsible for calculating and collecting VAT on their own, without relying on Wish’s Tax Settings support.
• For non-EU domiciled merchants without an EU establishment shipping orders within the EU, Wish calculates, collects, and remits VAT directly to the EU tax authorities via Wish’s One-Stop Shop (OSS), regardless of the consignment value.

Example of EU VAT calculation:

The price displayed to buyers is inclusive of VAT (i.e., there is no separate tax line shown at checkout).

France, 20% VAT rate, and the item price (pre-VAT) EUR 10:

	Calculation	Total
Item Price (pre-VAT)	10	EUR 10.00
VAT Calculation	10 x 20%	EUR 2.00
Total Price (displayed to buyers)	10 + 2	EUR 12.00

This is shown on the invoice at checkout:

Item (VAT inclusive) …………………….. EUR 12

This total price (VAT inclusive) is shown to merchants (on applicable orders) on the Order History and Order Details pages in Merchant Dashboard.

 

Australia

Australia requires Wish as an online marketplace to register for GST. 

For orders shipping to Australia:

Wish will assess and remit GST on products shipped to Australia (regardless of customs value, defined as the price the goods are sold for, minus shipping and insurance). GST will be calculated based on the price of the goods sold plus shipping and insurance.

For transactions with customs value greater than AUD 1,000, the customer may be required to pay the GST once again at the border upon delivery.  

 

New Zealand

New Zealand requires Wish as an online marketplace to register for GST. Wish will calculate, collect and remit GST on all sales to New Zealand customers, regardless of the origin of the goods or domicile of the merchant.

 

Norway

Norway requires Wish as an online marketplace to register for GST. 

For orders shipping to Norway:

Wish will assess and remit GST on products shipped to Norway with value of NOK 3,000 or less (value is the price the goods are sold for, minus shipping). GST will be calculated based on the price of the goods sold plus shipping and insurance.

For transactions with customs value greater than NOK 3,000, Wish will not assess GST to the customer. However, the customer will be responsible for paying the GST at the border upon delivery.  

 

Singapore

Singapore requires online marketplaces to register for GST under the Overseas Vendor Registration regime.

As a result, GST remittance obligation for products shipping to Singapore from outside of Singapore is determined by customer-paid price (excluding shipping) on an individual product-by-product basis:

• For products shipping to Singapore from outside of Singapore where the customer-paid price of the product is less than or equal to SGD400 (excluding shipping), Wish calculates, collects, and remits GST to the Singapore tax authorities. Wish automatically adds GST for applicable Singapore-bound products on top of the total customer-paid price (including shipping) and collects this during the check-out process.
• For products shipping to Singapore from outside of Singapore where the customer-paid price of the product is greater than SGD400 (excluding shipping), the customer is responsible for remitting GST (and any custom duties/fees, if applicable) on the importation of goods into Singapore at the time the customer picks up the product.

For products shipping within Singapore, merchants are responsible for calculating, collecting, and remitting GST to the Singapore tax authorities. Merchants may activate Singapore Tax Settings via the Merchant Dashboard to have the GST  calculated and collected by Wish. This GST amount is sent by Wish to merchants for merchants to remit to the Singapore tax authorities.

 

Frequently Asked Questions

1. What are the threshold requirements for a merchant to VAT/GST register for non-US countries? 

Every country has their own thresholds and requirements before merchants are required to register with the applicable taxing authority and collect and remit tax on sales (i.e., VAT, GST, etc.). It is the responsibility of the merchant to determine if they are making taxable supplies (i.e., a qualifying good) to customers that create a tax registration obligation.

Registration thresholds are typically measured based on a merchant’s taxable supply, commonly in a 12-month period. Countries that do not apply a registration threshold generally require registration, (regardless of volume or monetary amount of sales) as soon as the supplier makes a qualifying taxable supply.

For example:

• Registration threshold applied: Australia - An entity, whether in or outside of the Australian indirect tax zone, and whose current or projected annual turnover is at least equal to AU$ 75,000 (excluding GST) is required to register for GST.
• No registration threshold: Germany - Non-German businesses supplying taxable goods or services are generally required to register for VAT, even if the total value of supplies is EUR1.

2. In which countries does the Wish marketplace collect and remit transaction tax?

Some countries and regions have enacted regulations that require online marketplace facilitators to collect and remit tax (i.e., VAT, GST, etc.) if certain criteria are met. In countries where Wish has met these requirements, Wish will collect and remit tax.

In some instances, Wish may enter into agreements with local postal carriers to facilitate the remittance of transaction taxes to the authorities. The postal carrier is required to collect the transaction tax before the goods are released for delivery to the customer. In these situations, Wish is likely to withhold the tax due and the carrier may be deemed to be the supplier for compliance administrative purposes (i.e., the one required to report the tax to the tax authority). 

These arrangements provide convenience to the customers where they are not obligated to connect with the postal carrier to pay the applicable taxes.

In the following jurisdictions, Wish collects and remits tax for all applicable sales occurring on its marketplace:

• Australia  (on applicable Australia-bound orders as outlined above)
• Canada (Saskatchewan and Manitoba PST only)
• European Union (on applicable EU-bound orders as outlined above)
  • UK and EU merchants shipping refurbished goods within the UK or EU must adhere to a VAT margin scheme.
• New Zealand
• Norway (on applicable Norway-bound orders as outlined above)
• Singapore (on applicable Singapore-bound orders as outlined above)
• United Kingdom (on applicable UK-bound orders as outlined above)
• U.S. (including Puerto Rico)

3. In which countries do merchants have an obligation to collect and remit transaction tax on their own?

Merchants who make sales through the Wish marketplace may have an obligation to collect and remit tax based on their sales into a respective country, where Wish does not collect on their behalf. This obligation may be subject to a number of things (e.g., the value of goods, refurbished vs. new product condition).

The merchant is required to provide Wish with details regarding its sales (e.g., volume, value, tax collected, tax remitted, etc.) for Wish to perform periodic reviews that the merchant is fully compliant with the local law and where the merchant is liable and Wish has a legal obligation to confirm the merchant’s tax compliance. Where the merchant fails to be compliant, Wish reserves the right to remove the merchant from its platform.

4. Where can I find help with Tax Settings?

To receive support for issues with your Tax Settings, please email Wish at taxsettings@wish.com. When you reach out, please include your merchant ID and a description of the issues you encounter; be sure to copy your Account Manager in your email as well, so we can review and address your question in a timely manner.