I’m experiencing the same issue, and it’s becoming a serious concern.
A few months ago, I noticed that a small number of customers were being charged sales tax when paying through a fixed payment link that we’ve been using consistently for over a year. At the time, it seemed random and infrequent, so I assumed it might be some kind of legitimate or system-related charge and didn’t pursue it further.
However, starting yesterday, the situation escalated significantly. Around 90% of payments made through the exact same payment link are now being charged sales tax. This is clearly not correct, especially since:
- Our services should not be taxed
- Tax settings are disabled
- Random transactions are not being taxed
- No changes were made to the payment link or account configuration
I contacted support and spent over an hour speaking with multiple agents. The experience was frustrating and inconsistent:
- The first agent acknowledged the issue seemed abnormal but could only suggest disabling taxes account-wide (which is a temp fix)
- After being placed on hold multiple times, I was transferred to another agent who confirmed this behavior is not normal
Their suggested solution was to refund the collected tax. However, this creates another problem:
- The tax appears as a separate line item on the receipt
- There is no option to selectively refund just the tax
- If I issue a manual partial refund, the system still records the tax as “collected,” which means I may still be liable to remit it to the state
I am currently still on hold trying to get a clear resolution.
This is a financial system—unexpected tax charges and lack of proper refund handling should not be happening. I’m sharing this here to see if others are experiencing the same issue and to push for a proper explanation and fix from Square.
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Update: After being on hold for an extended period, the representative told me I needed to wait a bit longer to be transferred to another agent. It didn’t sound like I had much of a choice. After an even longer wait, the automated system offered a callback option instead of continuing to hold.
At that point, I couldn’t stay on the line any longer, so I left my number and am waiting for a callback.
I’ll share more updates once I hear back.
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Update 3/31
After a few days of waiting, I finally received a response from a Square Application Support Engineer, but unfortunately the issue is still being dismissed rather than addressed.
They are describing this as an “enhancement” to better align with tax regulations and suggested that I consult a tax professional. However, this does not explain the inconsistent and intermittent behavior—taxes were applied randomly to the same payment setup, then stopped, and later appeared again. That points to a system issue, not a configuration or compliance matter.
At this point, it feels like the problem is being deflected rather than investigated. Given that multiple users are reporting similar experiences, this may indicate a broader issue rather than isolated cases.
I have escalated this further and requested a formal explanation and resolution. I would encourage others experiencing the same problem to do the same—continued escalation is likely the only way to get this properly reviewed.
If this cannot be resolved, it may need to be raised with appropriate regulatory authorities due to the financial and tax reporting implications involved.
I’ll share updates if I hear anything further.
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Update 4/1
I just received another response, they’re basically saying:
- “System worked as designed”
- “It was due to my configuration”
- “They can’t fix past transactions”
- “I am responsible for the tax reporting”
They are trying to :
- Close the case
- Avoid admitting a bug
- Push all financial responsibility onto me (the user)
Where this explanation is weak
There are two big holes in what they wrote:
1. “Phased rollout” = controlled inconsistency (their problem, not my)
They admitted:
“early stages… taxes could be influenced by both settings”
That’s a problem.
I (We the users) cannot have a system where:
- Same payment link
- Same setup
- Different tax outcomes
and call it “working as designed.” That’s not compliance-safe behavior.
Even if we accept their explanation:
- we were never clearly informed this would happen
- I / we the user had no clear toggle or control to prevent it
- The behavior changed mid-operation
That’s not acceptable for anything tied to tax collection.
The biggest issue here: “Square does not have the ability to retroactively modify or remove taxes”
in reality:
- They may not allow support agents to do it
- But at the system level, they absolutely can adjust reporting or issue corrections
They just don’t want to.
I run a business and we collect more than 1million every year through Square. I cannot believe I have to deal with this kind of issue and wasting tons of my time here.
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Today is April 8th, it's been 7 days since I last time replied to the Square Application Support Engineer, still no responses.
Seven days with no response usually means one of two things:
- It’s sitting in a queue they don’t want to deal with
- Or it already got escalated internally and no one owns it yet
This definitely seems like a serious thing as it looks to be affecting multiple users. I have tagged a mod, so hopefully someone can chime in from Square. Unfortunately, I'm just another Square user; I can't help with this. I haven't ever used payment links so I wouldn't be of any help. Just commenting to try and bump the thread.
I tis never fun when one hand of a company doesn't know what the other is doing. It does seem to happen too often. But I guess the good news is that you found the issue.
