Sales Tax Treatment for US QuickBooks Users

If you are using the US version of QuickBooks and charge sales tax on invoices, you should be aware of how sales tax calculations are handled in QuickBooks.

Selecting a Sales Tax Account
If you charge sales tax on your invoices you will need to select a sales tax account on your Sync Settings page in Teachworks.  The sales tax account that you select will have a tax rate specified in QuickBooks.

How QuickBooks handles sales tax on your invoices synced to QuickBooks will depend on whether you are using QuickBooks' default sales tax method or it's new "Sales Tax Center".  

QuickBooks Default Sales Tax Method

This method is more flexible and allows you to set different tax rates on invoices that you sync to QuickBooks.

• If you create an invoice in Teachworks and set its sales tax treatment to "Tax Exclusive" you can set the tax rate to any percentage (even if it is different from the rate specified for the sales tax account in QuickBooks) and when the invoice is synced to QuickBooks it will use the sales tax rate that you set in Teachworks.
• The US version of QuickBooks does not support "Tax Inclusive" sales tax treatment.  As a result an invoice synced with this tax treatment will not have tax applied in QuickBooks.
• Setting an invoice to "Tax Exempt" will ensure that no sales tax is added by QuickBooks.

QuickBooks Sales Tax Center (Automatic Sales Tax)

When using the Automatic Sales Tax method in your QuickBooks account, QuickBooks will force the invoice to use the sales tax rate specified on the Custome profile in QuickBooks (this is found by going to the Customer's profile and clicking the "Tax Info" tab). 

• If you create an invoice in Teachworks and set its sales tax treatment to "Tax Exclusive" when the invoice is synced to QuickBooks, QuickBooks will use the sales tax rate the tax rate specified on the Customer's profile even if this is different than the tax rate on the invoice in Teachworks.
• The US version of QuickBooks does not support "Tax Inclusive" sales tax treatment.  As a result an invoice synced with this tax treatment will not have tax applied in QuickBooks.
• Setting an invoice to "Tax Exempt" will ensure that no sales tax is added by QuickBooks.