Returns already take extra work. Now Shopify is making one part of it easier.
Starting October 23, 2026, Shopify will automatically calculate tax on return shipping fees. This applies to eligible US merchants using Shopify Tax or Tax Platform.
Return shipping fees will now be taxed automatically
When a customer returns an order, merchants can charge a return shipping fee.
Going forward, Shopify calculates the tax on that fee automatically, treating it just like any other shipping charge.
Merchants no longer need to work out this tax manually.
Shopify will show the tax during the return
You'll see the estimated tax the moment a return is created.
Once the return is complete, Shopify records the final tax amount and adds it to your tax reports automatically.
That gives you a clear, accurate view of the tax tied to every return.
Your current tax settings still apply
This update doesn't change how your existing shipping tax settings work.
If shipping is untaxed in a certain state, return shipping in that state stays untaxed too.
It's still worth double-checking your settings to make sure everything's set up the way you expect.
Check any manual tax workarounds
Most eligible merchants don't need to do anything. Shopify handles the calculation automatically.
But if you're currently running a manual process for return shipping tax, review it before October 23.
You may need to turn it off once Shopify starts calculating this automatically — otherwise, you risk counting the same tax twice.
A simpler way to handle returns
Tax is one more detail to manage during returns. Automating it removes a step.
With this update, Shopify calculates the tax, shows the estimate during the return, and logs the final amount in your tax reports.
For eligible US merchants on Shopify Tax or Tax Platform, this makes return shipping tax easier to manage and track.
Read the original update: Shopify Changelog – Tax is now calculated on return shipping fees
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