How to Manage SALES TAX – set up, collect, report and pay sales tax in QuickBooks Online

QuickBooks Online – How to Manage SALES TAX – set up, collect, report and pay sales tax
From the Dashboard > Taxes
Set up products and services and make it taxable > Gear > Lists > Products and Services > New > select ‘Is taxable” box.


Also, see reference article:
Sales tax in QuickBooks Online

How to record sales tax refund check from Tax Agency in QuickBooks Online

I’ve not seen a single article from QuickBooks Help related to this subject on how to record Sales Tax refund check in QuickBooks Online. Most of the answers found don’t work or whoever answered the questions does not fully understand how Sales Tax Center is so limited to making any credit/refund adjustments. It’s not clear this functionality is even available in QBO.

What I found as a workaround is to create a Sales Receipt in QBO. Ths assumes negative balance is already shown in Sales Tax Center. In other words, you’re expecting this refund from the Tax Agency.

These are the steps to follow in creating a Sales Receipt:

  1. For Customer field, create a new one (example zSales Tax Adjustment) or leave it blank still works.
  2. Select deposit to bank account.
  3. Select same Products/Services items, one as a taxable item and another one non-taxable item.
  4. With taxable sales item, it should compute sales tax refund amount at the bottom. In this example shown in the screenshot below, taxable sales amount is $21,750, the tax rate is 8% and received $1,740 refund from Tax Agency.

Sales Tax on Shipping Costs

What Small Businesses Need to Know About Sales Tax and Shipping
QuickBooks blog
From the article: For small businesses selling goods online to remote customers, shipping is an integral part of doing business. And, some states tax shipping costs just like they tax the purchase price for a product sold. But, then again … some states don’t. If you want to get your sales taxes right and avoid non-compliance penalties, you need to know when sales taxes on shipping applies. …

Related article: Top 5 Sales Tax Filing Mistakes That Small Businesses Make


Video Tutorial
QuickBooks Online – how to charge sales tax on shipping in QBO Invoices Sales Receipts


 







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Does QBO automatically pull deposits pre-payment on taxable items into Sales Tax Payable

The answer is no.

Deposit field on Invoice is below the total field. It does not compute sales tax on deposit (acts more like pre-payment) field in QBO. If you run the Sales Tax Liability report from the Sales Tax Center (View sales tax liability report under Related Tasks at the far right side). Just click the tax amount. It will take you to the Transaction Report. You can run this report on a cash basis, you will not see sales tax amount on that deposit or the taxable amount on that invoice total. Of course, on an accrual basis, you will see sales tax amount on the whole taxable sales invoice amount.

In this example, refer to invoice #15-00334 with $100 deposit. No tax amount on a cash basis. Only tax amount on an accrual basis. That is the way it’s supposed to be.

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How do I edit rename a sales tax agency in QBO

To edit and rename the Agency paid for Sales Tax in Sales Tax Center:

1. Click on Sales Tax (or under taxes) at left navigation bar.

2. Right below the Agency name is a blue link to rename. (Screenshot 1 below).

3. Then enter the Agency name so when you write a Sales Tax Payment check, the Payee name is correct.

sales-tax-rename






Do we charge sales tax on a discount amount

It really depends on state regulations and also discount type. You would need to contact your local sales tax agency for this answer.

FOR EXAMPLE

Any in-store discount may reduce sales tax. However, any manufacturer coupon still has to have sales tax paid on it.


 

Sign up QuickBooks subscription for new company. Or add additional company subscription for using the same user ID (choose “Already have an Intuit user ID?”)

How to print sales tax check in new QuickBooks Online?

From the blue navigation bar on the left > select Sales Tax tab > select “Record Tax Payment” blue button > New “Record Sales Tax Payment” screen will open > “Print a check” checkbox is located right below Notes field > select Checkbox > select “Record Payment and Print Check” blue button

Now, sales tax check in queue to be printed

From the Create (+) sign > select Print Checks

Follow other selections to preview and print check

QuickBooks Online: Where do I find the amount of sales taxes due

Sales Tax Center
Sales Tax Center
print sales tax check
print sales tax check

I don’t see any data when I run sales tax report. I list non taxable and taxable sales when I deposit sales

In order to get total sales and taxable sales with sales tax collected, you will need to run a “Sales by Customer Detail” report. This stand-alone report will not give you all the information you need to file the Sales Tax Return. You will need to further customize it to work-around.

To do this, you will to run a “Sales By Customer Detail” report, customize it and add “tax amount” and taxable amount” columns from selecting “Change Columns.

These are the necessary steps, you will need to take.

  • From the blue navigation bar on the left
  • Select Reports
  • Select “Go to report” (magnifying glass), type Sales by Customer Detail
  • Select “Sales by Customer Detail” from drop-down selector
  • Change Transaction Date as needed
  • Select “Customize” blue button (upper left)
  • Select “Change Columns” under Rows/Columns
  • Add Tax Amount (refers to tax collected)
  • Add Taxable Amount (refers to taxable sales)
  • Add Tax Name (if needed)
  • Select Remove button and remove unnecessary columns (optional)
  • Click OK button
  • Click Run Report

This will give Total Sales and Total Taxable Sales. Subtract these two columns in order to get Non-Taxable Sales.

Recommended: Also click “Save Customizations” button to make this as customized report for future use.

 

Customize Sales Tax Report - Change Columns
Customize Sales Tax Report – Change Columns

Customize Sales Tax Report - Total Sales and Taxable Sales

Customize Sales Tax Report - Taxable and Non-Taxable Sales