QuickBooks sales tax assists you in collecting taxes for definite services and goods. It will help you to retain a correct record of the taxes so that you can effortlessly monitor and send them straight to the tax-collecting agency. The sales tax report can create tax, calculate tax, and track sales tax more conveniently. Along with this, sales tax items are used to recognize the rates charged to the customers.
This blog will guide you with the right steps to add a tax rate and agency, add a combined tax rate, edit a tax rate, and configure sales tax settings. To start with, first of all let’s learn things which you need to keep in mind before setting up QuickBooks sales tax.
Before you set up your sales tax
- In the beginning, you need to check the sales tax requirements.
- It is must to know the agency you paid taxes.
How to Set up Sales Tax in QuickBooks?
To setup sales tax in QuickBooks Online will help you to discover the right method to add a tax rate and agency. Along with this, it will also cover the section of setting up the combined rate. You will also learn the process of editing a tax rate, configuring QuickBooks sales tax settings, and deactivating a tax rate.
Add a Tax Rate and Agency in QuickBooks Sales Tax
Here, you will learn the right steps to add a tax rate agency:
- At first, you need to select the Taxes option from the left menu.
- After that, you have to choose add/edit tax rates and agencies option.
- Select New and then you have to choose either a solitary or a combined tax rate.
- Afterwards, you have to add a name for the tax, and the agency.
- Add the percentage for the rate.
- Finally, click on Save.
Now, move to the next step and learn how to add a combined rate properly in QuickBooks Sales tax.
Add a Combined Rate
In case you have to track sales tax for more than one tax agency, set up a combined tax rate.
Follow these steps to add a combined tax rate:
- First of all, you need to select Taxes from the left menu.
- Now, select add/edit agencies and also tax rates.
- After that, you need to choose new and then select the combined tax rate.
- Now, add a name for the combined rate and also the distinct sales tax requirements.
- Select the additional components option (Optional).
- In the end, select Save.
Things to Know about combined rate in QuickBooks sales tax:
- Sales Tax Center keeps a record of tax rate and shows the right amount in each category.
- You have the choice to add up to 5 components in a combined tax rate.
Also Read: How to Resolve QuickBooks Error 1618?
These things will occur once you are done with the steps:
- You will see the new rates in the Sales Tax Rate and Agencies list on your PC screen.
- There is an option to choose the new combined rate in forms such as invoices.
- It’s easy to view the amounts on your system’s screen.
- You can see the correct Sales Tax Liability report on the screen.
After this, let’s learn the process of editing the tax rate step by step in QB sale tax.
Edit a Tax Rate
These steps will guide you with a fairly easy process to edit QuickBooks tax rate:
To edit a tax rate:
- You need to choose Taxes from the left menu.
- Next, you have to select add, edit tax rates and agencies.
- You have to choose the rate to change and chose the Edit option.
- Next, add the new rate.
- Change the agency name.
- Click on the Save option.
Things to know:
- You can edit a sales tax rate if changes are required.
- You can edit only component rates.
- To edit a combined rate, you have to make modifications to its component rates.
Once the editing is done, a few things will happen:
- The new rate will be seen on your system’s screen for new transactions.
- The earlier rate will no longer be used after editing a rate.
- Present transactions that used the previous rate remain will not be changed.
- You will see the data for the rates.
Now, it’s necessary to learn the process to configure QuickBooks sales tax settings.
Configure QuickBooks Sales Tax Settings
Change the sales tax center filter
These steps will guide you to configure QuickBooks sales tax settings:
- You need to choose the Taxes option.
- After that, choose the preferred filter.
Edit sales tax settings
Therefore, to edit sales settings, turn the sales tax on or off via editing sales tax settings:
- To begin with, choose Taxes.
- Now, under the Related Tasks, select Edit sales tax settings.
- Then choose Yes.
- You have to set the following choices (Optional)
- Set a default tax rate
Automatically, the default rate is selected in new sales forms. Its users can select a different rate if required.
- Select “Mark all new customers are taxable” option
Modify this setting for individual customers in the Tax Info section of every customer record.
- Choose Mark all new products and services are taxable choice
It means the items you add to a form have the Tax column is already selected.
- You need to select No in case you don’t charge sales tax.
- Finally, choose Save.
Last but not least, let’s learn the right steps to deactivate a tax rate.
Deactivate a Tax Rate
These steps will deactivate a tax rate from your QuickBooks Online interface:
- To start with, you need to choose Taxes.
- After that, you need to select Add/edit tax rates and agencies.
- Afterwards, select a tax rate name and then choose Deactivate option.
- Choose continue option.
Hopefully, the steps have given you a basic knowledge of using sales tax in QuickBooks online.
Till now, we have focused on the definition of QuickBooks sales tax in this blog. We have also, discussed the steps of how to set up sales tax in QuickBooks online, edit a tax rate, and deactivate the tax rate. Hope, the complete process of setting up sales tax is clear to you.
In case you face some issue in following the steps of setting up QuickBooks sales tax, you can dial the QuickBooks Online Support Phone Number.