diff --git a/ghost/stripe/lib/StripeAPI.js b/ghost/stripe/lib/StripeAPI.js
index 576f885359..504b8b0c1f 100644
--- a/ghost/stripe/lib/StripeAPI.js
+++ b/ghost/stripe/lib/StripeAPI.js
@@ -475,7 +475,6 @@ module.exports = class StripeAPI {
             automatic_tax: {
                 enabled: this._config.enableAutomaticTax
             },
-            customer_update: this._config.enableAutomaticTax ? {address: 'auto'} : {},
             metadata,
             discounts,
             /*
@@ -498,6 +497,10 @@ module.exports = class StripeAPI {
             stripeSessionOptions.customer_email = customerEmail;
         }
 
+        if (customerId && this._config.enableAutomaticTax) {
+            stripeSessionOptions.customer_update = {address: 'auto'};
+        }
+
         // @ts-ignore
         const session = await this._stripe.checkout.sessions.create(stripeSessionOptions);
 
@@ -527,7 +530,6 @@ module.exports = class StripeAPI {
             automatic_tax: {
                 enabled: this._config.enableAutomaticTax
             },
-            customer_update: this._config.enableAutomaticTax ? {address: 'auto'} : {},
             metadata,
             customer: customer ? customer.id : undefined,
             customer_email: !customer && customerEmail ? customerEmail : undefined,
@@ -548,6 +550,10 @@ module.exports = class StripeAPI {
             }]
         };
 
+        if (customer && this._config.enableAutomaticTax) {
+            stripeSessionOptions.customer_update = {address: 'auto'};
+        }
+
         // @ts-ignore
         const session = await this._stripe.checkout.sessions.create(stripeSessionOptions);
         return session;
diff --git a/ghost/stripe/test/unit/lib/StripeAPI.test.js b/ghost/stripe/test/unit/lib/StripeAPI.test.js
index 61d7d942d6..9d87642764 100644
--- a/ghost/stripe/test/unit/lib/StripeAPI.test.js
+++ b/ghost/stripe/test/unit/lib/StripeAPI.test.js
@@ -341,5 +341,77 @@ describe('StripeAPI', function () {
 
             should.deepEqual(result, mockSubscription);
         });
+
+        describe('createCheckoutSetupSession automatic tax flag', function () {
+            beforeEach(function () {
+                mockStripe = {
+                    checkout: {
+                        sessions: {
+                            create: sinon.stub().resolves()
+                        }
+                    },
+                    customers: {
+                        create: sinon.stub().resolves()
+                    }
+                };
+                sinon.stub(mockLabs, 'isSet');
+                mockLabs.isSet.withArgs('stripeAutomaticTax').returns(true);
+                const mockStripeConstructor = sinon.stub().returns(mockStripe);
+                StripeAPI.__set__('Stripe', mockStripeConstructor);
+                api.configure({
+                    checkoutSessionSuccessUrl: '/success',
+                    checkoutSessionCancelUrl: '/cancel',
+                    checkoutSetupSessionSuccessUrl: '/setup-success',
+                    checkoutSetupSessionCancelUrl: '/setup-cancel',
+                    secretKey: '',
+                    enableAutomaticTax: true
+                });
+            });
+
+            afterEach(function () {
+                sinon.restore();
+            });
+
+            it('createCheckoutSession adds customer_update if automatic tax flag is enabled and customer is not undefined', async function () {
+                const mockCustomer = {
+                    id: mockCustomerId,
+                    customer_email: mockCustomerEmail,
+                    name: 'Example Customer'
+                };
+
+                await api.createCheckoutSession('priceId', mockCustomer, {
+                    trialDays: null
+                });
+                should.exist(mockStripe.checkout.sessions.create.firstCall.firstArg.customer_update);
+            });
+
+            it('createCheckoutSession does not add customer_update if automatic tax flag is enabled and customer is undefined', async function () {
+                await api.createCheckoutSession('priceId', undefined, {
+                    trialDays: null
+                });
+                should.not.exist(mockStripe.checkout.sessions.create.firstCall.firstArg.customer_update);
+            });
+
+            it('createCheckoutSession does not add customer_update if automatic tax flag is disabled', async function () {
+                const mockCustomer = {
+                    id: mockCustomerId,
+                    customer_email: mockCustomerEmail,
+                    name: 'Example Customer'
+                };
+                // set enableAutomaticTax: false
+                api.configure({
+                    checkoutSessionSuccessUrl: '/success',
+                    checkoutSessionCancelUrl: '/cancel',
+                    checkoutSetupSessionSuccessUrl: '/setup-success',
+                    checkoutSetupSessionCancelUrl: '/setup-cancel',
+                    secretKey: '',
+                    enableAutomaticTax: false
+                });
+                await api.createCheckoutSession('priceId', mockCustomer, {
+                    trialDays: null
+                });
+                should.not.exist(mockStripe.checkout.sessions.create.firstCall.firstArg.customer_update);
+            });
+        });
     });
 });