Assuming you have either a "verified" Premier Account or a "verified" Business Account and you've done your homework on your state's tax laws and regulations, you're ready to go. Note, each state is different, some states require that you tax the total amount including shipping, others do not. Some states have various tax rates depending on your location. You need to know all of the details upfront, then setting up your tax table calculations is easy.
Here's a few tips:
Each state is different when it comes to collecting state sales tax. Before setting up your Tax Tables, check with your state revenue department's regulations. In many cases you only need to apply state sales tax if the customer resides in your state. Additionally, within many states there are various tax rates according to the county and town the customer resides in.
Here's an example from a client:
If someone in the state of Colorado buys from a Colorado business, the tax applied is 2.9%. If the customer lives in Colorado and the business is in Summit County, the tax applied is 5.77%. And if the person lives in Colorado, Summit County and the business physically located in the town of Breckenridge, the total tax applied is 8.275%. In this scenario, per Colorado rules, sales tax is only applied to the merchandise total and not shipping. Each state is different.
In your PayPal Profile, you can setup your tax table by State and then drill down by Zip Code. The Zip Code allows you to apply various tax rates according to specific location within your state. You can also set the tax to apply to just merchandise total or to merchandise total and shipping depending on your state's tax rules.
It's best to contact your state revenue service to find out anything you have questions on. Once you have all the info you need, you can complete your PayPal Tax Table.
After everything is setup, when a customer makes a purchase on your site, before proceeding to Checkout, he or she enters their Zip code, not only does this include the shipping, it includes the proper state sales tax if any. And if needed under certain circumstances, you can override not charging tax in your HTML Button Code.
One important item to keep in mind, presently the Zip Code is only used to calculate Sales Tax. It has no effect on shipping fees, i.e., is not used to setup Zones, etc.
For additional info, see this guide:
https://www.paypalobjects.com/webstatic/en_US/developer/docs/pdf/pp_websitepaymentsstandard_integrat...
