Configuring Shopify Sales Channels for Accurate Tax Filing

Setting up your Shopify sales channels correctly in the Numeral Dashboard ensures your sales tax filings are accurate and compliant. How each channel is configured determines how those sales are treated in your filings. For example, if your Facebook and Instagram sales go through Shopify via a specific channel, you’ll want to make sure that channel is marked as Marketplace so Numeral does not double-remit tax on those sales since marketplace facilitators collect and remit tax on those sales for you.

Each channel should be classified as Direct-to-Consumer (DTC), Marketplace Facilitator, or Wholesale. More detailed explanations of each category have been included below as well as guidance on what default settings are already in place at Numeral and how to verify settings or configure unique channels in your dashboard.

Shopify Sales Channel Categories

View or manage your Sales Channels by navigating to Connections > Manage (under Settings) > Sales channels to manage your sales channels. Be sure to set the correct type for each channel to ensure accurate tax remittance.

⚠️ Important: All sales channels must be categorized correctly to ensure proper tax remittance. If not, you risk remitting tax on wholesale orders or double-remitting tax for marketplace orders in which tax was already collected and remitted.

You will be given the following options for each marketplace channel:

Direct-to-Consumer (DTC)

Sales made directly to the final customer—the end user of your product. Sales through DTC channels are generally considered taxable, unless the product itself is non-taxable in the state where the order is delivered. These sales are typically processed through your Online Store and will be associated with that sales channel. Tax collection on these sales is controlled by product categorization settings and shipping details like normal.

⚠️ See our article Shopify Partner Access <> Numeral for guidance on troubleshooting tax collection for sales in this category, including important settings and our scope of support.

Marketplace Facilitator

Platforms like Meta, TikTok Shop, Amazon, Walmart, or the Shopify Shop app.

These platforms collect and remit sales tax on your behalf.
Numeral will not remit tax for these sales on your filings, since the marketplace facilitator handles this for you.

Wholesale

Business-to-business (B2B) transactions where the buyer resells the product.

No sales tax should be collected.
Always confirm the buyer has a valid reseller certificate.

💡 Note: Configuring exemptions for specific customers is separate from marketplace channel settings. ↗ Learn how to set up customer exemptions in Shopify

Default Configurations to Verify During Onboarding

Numeral pre-flags some sales channels based on historical use cases to streamline setup. However, we recommend reviewing all defaults to ensure your channel usage aligns with tax treatment on our end.

Default Wholesale Channels

Faire: Sell Wholesale
Shopify Wholesale (B2B)
Draft Orders *Many clients use this channel for taxable sales, so flag it with our team if you don’t have any wholesale products
Shopify Collective
SparkLayer B2B & Wholesale

⚠️ If one of your wholesale or marketplace sales channels doesn’t match the exact title(s) listed above, flag it with our team to verify configuration. We can confirm the channel ID on the back end or add it to your store settings to ensure sales are treated correctly.

Configure Shopify Sales Channels in the Numeral Dashboard

Log into your Numeral Dashboard
Head over to the ‘Connections’ tab in the left hand-side menu:
Click ‘Show Details’ in your Shopify Store:
Click 'Manage':
Select ‘Sales Channels’
Use the dropdown menu to select DTC (Direct to Consumer), Marketplace or Wholesale:
Click ‘Save’

You’re all set!

💬 Questions? Reach out to our team anytime via the messaging widget in your Numeral dashboard.