Use tax amounts from unsupported systems with Stripe Billing
Use taxes calculated from an unsupported external system with Stripe Invoices.
If you use a third-party tax engine that doesn’t have a supported app in the Stripe App Marketplace to calculate tax, you can manually set tax amounts on your invoices with the tax_amounts parameter.
To let Stripe calculate tax for you, use Stripe Tax.
Create an invoice with manual tax amounts
This section describes adding manual tax amounts to invoice line items.
Create an invoice with an invoice item
The first step is to create an invoice. We assume you already have a customer created, but if you don’t, please reference the customers guide.
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Manual tax amounts can only be added to invoice line items, so add an invoice item to the invoice.
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Update the invoice line item with tax amounts
Use the tax_amounts parameter to directly set the tax amounts when you update invoice line items. You have to provide tax_rate_data with tax_amounts to ensure the relevant information is displayed to the customer. The following example shows how to update an invoice line item with the tax_amounts field:
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All of the fields under tax_amounts are required except for description, jurisdiction, jurisdiction_level, country, state, tax_type, and taxability_reason. The invoice line item object returns a tax_amounts field.
{
"id": "il_0O4tNe589O8KAxCGYD7OyXPP",
"object": "line_item",
"amount": 100,
"amount_excluding_tax": 100,
"currency": "usd",
...
"tax_amounts": [
{
"amount": 10,
"inclusive": false,
"tax_rate": "txr_0Ns7kW589O8KAxCGXoi7EAuS",
"taxability_reason": null,
"taxable_amount": 100
}
],
"tax_rates": [],
...
}
Note
Stripe automatically creates or reuses an existing tax rate based on tax_rate_data. However, Stripe calculates tax amounts on the invoice based only on the amount parameter. Other values, such as tax rate, are only used for rendering purposes to be shown on the invoice. No validations are run on these fields to make sure they’re consistent with the tax amounts specified.
Finalize the invoice
After all of the invoice line items are updated with tax amounts, you need to finalize the invoice. Tax amounts can’t change after the invoice is finalized. Refer to the edit invoice guide if you need to modify the invoice after finalization.
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Stripe automatically creates tax-rates
For manual tax amounts, Stripe requires information about the corresponding tax rate. The tax rate is only used to display information to customers. It isn’t used in any calculations.
Stripe automatically creates tax rate objects in the background based on tax_rate_data. If the same tax rate data is passed in multiple times, Stripe references the existing tax rate object instead of creating another one. The following fields are used to deduplicate the tax rate: percentage, inclusive, display_name, jurisdiction, jurisdiction_level, country, state, and tax_type. In this example, assume a second invoice line item was updated on the invoice from the previous section with the same tax_rate_data.
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{
"id": "il_0P6nbg589O8KAxCGRWBJAdNV",
"object": "line_item",
"amount": 100,
"amount_excluding_tax": 100,
"currency": "usd",
...
"tax_amounts": [
{
"amount": 10,
"inclusive": false,
"tax_rate": "txr_0Ny6QR589O8KAxCGo6MKGPxM",
"taxability_reason": null,
"taxable_amount": 100
}
],
"tax_rates": [],
...
}
Both invoice line items have the same tax_rate ID under the tax_amount. Stripe handles the tax rate creation and deduplication to minimize the burden on businesses. While the tax_rate ID maps to a valid tax rate object, the IDs mapped to automatically created tax rates can’t be passed into the tax_rates field on the API. The only exception to that rule is the create credit notes endpoint.
Issue a credit note
Credit notes allow for adjustments on invoices without needing to void an invoice. When issuing a credit note for an invoice line item with manual tax amounts, the API requires additional information to accurately create it.
Create credit note
The create credit note endpoint also accepts the tax_amounts parameter. The field is required when the corresponding invoice line item has manual tax amounts. This ensures accurate accounting of the credit note and maintains consistency with your invoices.
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Limitations
Keep in mind the following constraints when working with manual tax amounts.
Invoice items don’t have tax amounts
Manual tax amounts can only be added to invoice line items.
taxable_amount and tax_rates aren’t validated
The taxable amount and tax rate data passed in the request are only used for rendering purposes. They’re not validated against the tax amount in the request.
Can’t mix tax_amounts and tax_rates
An invoice line item can’t have manual tax amounts if it also has a tax rate, and vice versa. Invoice line items also can’t have manual tax amounts if the invoice has a default tax rate or if any of the other invoice line items on the invoice has a tax rate.
tax_amounts can grow stale when updating other fields
Existing manual tax amounts persist on the invoice line item unless directly edited. This can lead to stale tax amounts when updating the invoice item with fields relating to its amount, such as amount, discounts, or price.
Automatically created tax rates can’t be directly used
Stripe automatically creates tax rate objects for manual tax amounts. These tax rates can’t be directly referenced on invoice or payment-related endpoints, except the credit note endpoint. They also can’t be directly updated and won’t be included on the all tax rates endpoint. However, the tax rate’s data is accessible by calling the retrieve tax rate endpoint with its token.