How to Set Up Taxes With Stripe API?
To enable automatic tax calculation using Stripe’s API, you’ll need to configure your tax settings directly in your Stripe dashboard. This guide will walk you through the steps you need to take to ensure a proper connection.
First, you need to navigate to Payment Platform > Tax Settings to enable tax collection and choose the Stripe Tax API collection method:
For the Tax Behavior setting, you can choose one of the following options:
Exclusive: Tax is added on top of the product price. For example, if the product is $50 and the tax rate is 15%, the employer will pay $57.50 — that's $50 plus $7.50 tax.
Inclusive: Tax is included in the product price. For example, if the product is $50 and the tax rate is 15%, the employer will still pay $50 — with $6.52 of that amount being tax (i.e., the price already includes the tax).
From your Stripe dashboard navigate to the Tax Settings section to start the setup process.
To begin setting up tax auto-calculation, you'll need to provide the following information about your business and product:
1. Enter your Origin Address — this is the location of your business.
2. Select the Default Product Tax Code — You can check out this list of product tax codes on Stripe to see which one fits your business best. For job boards, it’s common to choose: General - Services or Website Advertising
Depending on your selected product tax code, Stripe might also ask you for "Default Shipping Tax Code". If it does, you should choose “Shipping”
3. Include Tax In Prices — This field should match the Tax Behavior you have selected in JBoard.
Important: If you have selected Exclusive then you need to choose No – If you have selected Inclusive then you need to choose Yes
Tax registrations indicate the states or countries where you're authorized to collect tax.
It's recommended that you only collect tax in regions where you're registered or plan to register. You can read more about adding registrations on Stripe here.
To start adding registrations, you need to navigate to the Tax - Registrations section in Stripe and click on Add Registration:
Then, you need to select the location where you want to collect tax
Once you've selected the location, set the Start Collecting field to Immediately so you can begin collecting tax from employers in that location right away.
Once completed, any employer from your registered location(s) will automatically be charged the applicable tax rate for that location during checkout.
Enabling Stripe API Collection
First, you need to navigate to Payment Platform > Tax Settings to enable tax collection and choose the Stripe Tax API collection method:
For the Tax Behavior setting, you can choose one of the following options:
Exclusive: Tax is added on top of the product price. For example, if the product is $50 and the tax rate is 15%, the employer will pay $57.50 — that's $50 plus $7.50 tax.
Inclusive: Tax is included in the product price. For example, if the product is $50 and the tax rate is 15%, the employer will still pay $50 — with $6.52 of that amount being tax (i.e., the price already includes the tax).
Stripe Tax Setup
From your Stripe dashboard navigate to the Tax Settings section to start the setup process.
Provide Business Information
To begin setting up tax auto-calculation, you'll need to provide the following information about your business and product:
1. Enter your Origin Address — this is the location of your business.
2. Select the Default Product Tax Code — You can check out this list of product tax codes on Stripe to see which one fits your business best. For job boards, it’s common to choose: General - Services or Website Advertising
Depending on your selected product tax code, Stripe might also ask you for "Default Shipping Tax Code". If it does, you should choose “Shipping”
3. Include Tax In Prices — This field should match the Tax Behavior you have selected in JBoard.
Important: If you have selected Exclusive then you need to choose No – If you have selected Inclusive then you need to choose Yes
Adding Tax Registrations In Stripe
Tax registrations indicate the states or countries where you're authorized to collect tax.
It's recommended that you only collect tax in regions where you're registered or plan to register. You can read more about adding registrations on Stripe here.
To start adding registrations, you need to navigate to the Tax - Registrations section in Stripe and click on Add Registration:
Then, you need to select the location where you want to collect tax
Once you've selected the location, set the Start Collecting field to Immediately so you can begin collecting tax from employers in that location right away.
Once completed, any employer from your registered location(s) will automatically be charged the applicable tax rate for that location during checkout.
Updated on: 26/03/2025
Thank you!