Stripe Customer Tax ID

Which tax IDs change the tax calculation

Stripe's tax ID documentation lists every supported type with an example and a Yes or No in the Impact in Tax Calculation column. Its footnote explains Yes: "Stripe Tax won't apply tax if this tax ID is provided, in line with the relevant laws." No means Stripe stores and prints the number, and the tax calculation ignores it.

The pairs are where mistakes happen. New Zealand has nz_gst (GST number, Yes) and nz_bn (New Zealand Business Number, No). Canada has ca_gst_hst (GST/HST number, Yes) and ca_bn (Business Number, No). Poland has eu_vat (the PL-prefixed VAT number, Yes) and pl_nip (NIP number, No). A customer set up with the second number of a pair gets charged tax as if it were a consumer, and nothing on the invoice looks wrong.

Some countries have only a No type. Malaysia's my_sst and Kenya's ke_pin are No, and so is the US us_ein. In those places a business customer's number is for display, and any business exemption has to come from somewhere else in the regime, or from the customer's tax status in Stripe.

Before you rely on a tax ID to stop tax, look up its type in Stripe's table rather than assuming from the country.

What Stripe validates, and what it does with an unverified number

Stripe checks every tax ID against the expected format for its type. For three types it also checks the number with a government system: Australian Business Numbers with the Australian Business Register, EU VAT numbers with the European Commission's VIES, and UK VAT numbers with HMRC. Stripe says each of these checks "only verifies the validity of the tax ID," not whether the name and address on the customer match.

The result lands on the tax ID as a verification status: pending, verified, unverified or unavailable. Stripe sends a customer.tax_id.updated event when verification finishes, and says that "after a tax ID is confirmed as valid or invalid, it won't be validated again automatically." When the status is unavailable, you must verify the number yourself.

The calculation does not wait for any of that. Stripe's documentation: "If you use Stripe Tax, Stripe Tax applies the reverse charge or zero rate according to applicable laws when the tax ID has the required number format, regardless of the government verification result." An unverified EU VAT number in the right format still stops Stripe charging VAT. Deciding what to do with it is, in Stripe's words, based on "your own compliance requirements."

For every other type, format is the only check. Whether the tax authority expects more depends on the country. Egypt expects the seller to verify each number, while New Zealand lets the seller rely on the number the customer gives.

Collecting tax IDs: Checkout, the Dashboard, the API

There are three ways in. In the Dashboard, open the customer, click Update details and add a tax ID row with its type and value. Through the API, create a tax ID with the customer as its owner. And in Stripe Checkout, set tax_id_collection[enabled] to true, and Checkout shows a tax ID field and a business name field to customers in supported locations.

Checkout has rules of its own. It collects business tax IDs only, and customers can enter only one. It decides whether to show the field from the shipping address if there is one, otherwise the billing address. If an existing customer already has a saved tax ID, Checkout does not show the form at all. Setting tax_id_collection[required] to if_supported makes the number mandatory for customers in supported countries.

Checkout's list of collectable types is shorter than the full list. It includes nz_gst but not nz_bn, for example, and no US types. And for guest customers, Stripe says the session holds the type and value "but not a verification result." To get one, save the tax ID to a customer.

Tax IDs cannot be edited. Stripe: "To update a tax ID, delete the old ID and create another one."

Where the number shows up afterwards

On documents, customer tax IDs print in the header of invoice and credit note PDFs, next to your own account tax IDs. Stripe is explicit that "Stripe displays a customer tax ID on an invoice, whether or not it's valid," and that keeping customer information accurate is your responsibility.

In reporting, Stripe Tax's itemized export has a customer_tax_id column listing the type and value pairs attached to each transaction. Filter a country's zero-tax rows and that column tells you which business numbers you relied on, which is exactly the list some authorities expect you to keep.

The export also has a customer_taxability_override column, with values customer_exempt, reverse_charge or none. That is the customer's tax status, a different field from the tax ID. You can set a customer to reverse charge or exempt directly, without any tax ID, which is how you treat a business whose only number is a No type when the rules let you.