How to Mark a Stripe Customer Tax Exempt

Your setup decides the steps:

Use the Stripe steps if Stripe Tax or Stripe's manual tax rates calculate your tax.
Use the CereTax steps if the CereTax for Stripe app is connected to your Stripe account.

If Stripe Calculates Your Tax

Open the customer's page in the Stripe Dashboard and set the tax status to Exempt. The customer page's side panel then reads "Tax status and IDs: Exempt." With the application programming interface (API), set tax_exempt to exempt.
Make the change before the invoice is finalized. A new invoice is a draft, and you read each invoice's status on the Invoices page. Finalizing makes the invoice open and copies the customer's tax status to it. To change the tax status on a finalized invoice, void the invoice. Then duplicate it and update the duplicate. Consult local regulations on whether and how you can amend or void an invoice. You might need to issue a credit note or another invoice instead.
For a new subscription, invoice, or Checkout Session, use this saved customer.
Open the next invoice. With manual tax rates, the invoice carries no tax. With Stripe Tax, the API returns customer_exempt in the taxability_reason field.

If CereTax Calculates Your Tax

Exempt the Whole Customer

With the CereTax Stripe connector, set the customer's Tax Status to Exempt in Stripe before the invoice is created.
When Stripe creates or finalizes an invoice, a webhook sends it to CereTax. Open the Webhooks tab in Workbench, select the endpoint whose URL you copied from the CereTax for Stripe configuration page, and open its Event deliveries tab.
The connector needs five events: customer.created, customer.updated, invoice.created, invoice.finalized, and invoice.updated. After Stripe creates the next invoice, its invoice.created event should read Delivered. After Stripe finalizes it, so should invoice.finalized.
For a Failed or Pending event, open it to see the status code and any scheduled retry time. In live mode, Stripe retries each event for up to three days. The Resend button on an event works for up to 15 days after the event was created.
For errors, log in to the connector admin interface, select the connector logs tab, and filter by the Stripe invoice identifier. If events still fail, ask us.
Open the next invoice. As in the knowledge base example, each tax line reads $0.00 and the total equals the subtotal. The connector sends product/service code 10010200 on every line to mark it exempt.

Exempt Line Items for a Taxable Customer

Before you add the key, check which customers and invoices use the product. A product sold at one price needs only one price, so many invoices can share it.
In Stripe, add the metadata key IsTaxExempted with the value true in the Product Pricing section.
Open the next invoice. The connector sends code 10010200 on that line to mark it exempt, and tax details are added to the invoice.

Keep the Certificate

Stripe Tax does not validate exemption certificates. Stripe holds you responsible for any obligation to validate a customer's exempt status and collect any required documentation.

We suggest one owner for the exemption status and the certificate. That person sets Exempt only after the certificate is on file.

SmartExempt is our certificate management product.

We do not cover who qualifies for exemption, what a certificate must contain, mixing both methods, or running CereTax and Stripe Tax on one account.

Next Step

See SmartExempt, which connects to Stripe.

Sources

Stripe, Zero tax amounts and reverse charges
Stripe, Tax rates
CereTax, CereTax for Stripe Billing integration announcement
CereTax, Stripe - Install & Setup
Stripe, The Customer object
Stripe, Customers (Stripe Billing)
Stripe, How invoicing works
Stripe, Manage invoices
Stripe, Status transitions and finalization
CereTax, CereTax for Stripe Billing
Stripe, Receive Stripe events in your webhook endpoint
Stripe, Manage event destinations
Stripe, Types of events
Stripe, Manage webhook endpoints
Stripe, How products and prices work
CereTax, Exemption Certificate Management Software
Stripe, Tax exemptions

Reviewed October 16, 2026. We review this page again within 30 days.

Managing Exemption Certificates?

See SmartExempt, which connects to Stripe

Frequently Asked Questions

Does Stripe Tax manage exemption certificates?

No. Stripe says Stripe Tax does not let you upload, store, validate, or track exemption certificates, and you must manage them outside Stripe Tax. Keep the certificate in a system you control, and set the customer's status after the certificate is on file.

Is there certificate management that connects to Stripe?

Yes. SmartExempt, our exemption certificate management product, connects to Stripe. The CereTax connector for Stripe Billing calculates tax when Stripe creates or finalizes an invoice. Stripe Tax does not store or validate exemption certificates, so you manage them in a separate system. You still set each exempt customer's tax status in Stripe.

Can I exempt a Stripe customer in only one state?

In Stripe Tax, yes, through a feature in private preview. Stripe lets you exempt a customer in one United States state, and the exemption covers every local jurisdiction there. Other states stay taxable. A customer-level status of Exempt applies to all transactions instead. Stripe says these exemptions only affect tax calculations made by Stripe Tax and do not affect those of third-party tax providers.

Kelsey VanArtsdalen

VP of Customer Success

After more than a decade in sales tax compliance and customer success, Kelsey knows what it takes to keep complex implementations running smoothly and clients happy. She’s passionate about building strong relationships, solving problems before they escalate, and making sure every customer feels like a priority.