Nemo Works

Sales tax

QuickBooks Desktop works tax out itself, from the tax item on the invoice, rounding each rate separately. The store has its own figure. Choose how the two are kept equal (Settings, Sales tax, “How tax is written”):

One QuickBooks tax item works it out

For a store that charges one rate (or one combined group) wherever it collects tax. Pick the tax item for taxed orders and a 0% item for untaxed orders. When QuickBooks’ rounding differs from the store’s by a few cents, a line on the rounding item (“Web Rounding” unless you chose another, Settings, Products and items) makes up the difference: up to 1 cent for each taxed line and each tax rate, at least 2 cents, never more than $1.00. A bigger difference stops the order: it means the rate or item is wrong, or part of the order was paid with something that is not on its lines.

A tax item for each store rate

For stores using WooCommerce’s tax rate table with several rates. On Mapping, Sales tax, pair each store rate with a QuickBooks tax item (same names are suggested). When an order is taxed at several rates together (for example state plus county), pair that combination with a QuickBooks tax group; the combination appears on Mapping the first time an order stops on it, and the Queue links straight to it.

The exact tax as one line (tax plugins)

For TaxJar, Avalara, WooCommerce Tax and others that work out a rate per address. No single QuickBooks rate can match those, so:

  • the invoice uses your 0% tax item, and products go on untaxed;
  • the tax the customer paid goes on as one line, with the “Web Sales Tax” item (created for you the first time), posting to Sales Tax Payable (Settings);
  • refunds give tax back the same way.

Invoices then equal the order to the cent, and your tax liability is in one account to pay from. QuickBooks’ own sales tax reports will not show these sales as taxable, so file from your tax plugin’s reports.

Groups with non-taxable members

QuickBooks taxes each member of a group item by its own tax code. A product the store does not tax, paired with a group that has taxable members, stops before anything is booked. A taxed product paired with a group that has non-taxable members stops only when QuickBooks’ tax would differ from the store’s by more than rounding; the message gives the difference.