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Handling tax-exempt customers in Lightspeed eCom

Some customers in your online store, like wholesalers and nonprofit organisations, can be exempt from taxes. Lightspeed eCom (E-Series) allows to mark such buyers as non-taxable, so that they could check out in your online store without taxes applied to their orders. 

For instructions on setting up taxes in eCom, please refer to the Configuring taxes in Lightspeed eCom article.

How to mark customers as tax-exempt

In order to exempt a customer from paying taxes in your online store, you should mark them as non-taxable in your eCom admin panel by following the steps below:

  1. From your Retail POS, go to Online > Overview and click the Go to eCom (E-Series) button.
  2. In your eCom admin panel, go to My Sales > Customers.

  3. Find the customer on the list by name or email, or filter your customer list.

    If a customer doesn't have a profile in your store yet, you can add them by clicking + Add New Customer, or they can sign up themselves.

  4. Tick the customers you want to mark as tax-exempt.

  5. Click Mass Update > Change Tax Exemption Status > Enable Tax Exemption:

    Changing tax exemption status for a customer

That’s it. Now the customer is marked as tax-exempt and, after logging into their customer account in your online store, they will pay no taxes when buying from you.

The tax-exempt status may provide not only complete relief from taxes, but also reduced tax rates, or tax exemption for a certain category of goods. Currently, eCom allows setting only a 0% tax rate for non-taxable customers, which is automatically applied to all products in the online store.

If a customer marked as tax-exempt still sees taxes at checkout

In order to get a 0% tax rate, non-taxable buyers have to sign in to your online store before heading to checkout and placing an order. Otherwise, the standard taxation rules configured in the store will be applied.

Such customers should be advised to log in before purchase using the correct email. You as the store owner can check this email on the Customers page in Retail POS (X-Series).

If you have many tax-exempt customers, consider providing them with the instructions (for example, in a FAQ page) on creating an account and contacting you about tax-exempt purchases in your store.

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