Tax Exempt customers

5 replies
32 views

I have a tax exempt customer that is buying an item that will in fact be taxable because they are not selling it. How do I make just one invoice taxable?

QuickBooks Online

MaryLandT

Level 10

I'm here to help make an invoice taxable, kayann714.

In QuickBooks Online, you have the option to mark an item taxable. Just put a check mark in the Tax column when you create an invoice. Then, choose a tax rate so the system will calculate the tax.

Let me show you how:

Click + New.
Select Invoice.
Choose a customer and enter other information.
Mark the Tax checkbox if you need to charge sales tax.
Choose the tax rate.
Click Save.

I've added this link: Set up and use automated sales tax to learn how QuickBooks calculates your sales tax.

Feel free to leave a comment below if there's anything else you need. I'm always around to help you.

kayann714Author

Thank you for the help!!! The items are already checked as taxable, but tax doesn't calculate because the customer is tax exempt. I am using the new auto tax feature. What do you mean select the right tax rate? It chooses for me.

DivinaMercy_N

Moderator

Thanks for getting back here, @kayann714.

When setting up sales tax in QBO, you're in charge to choose the correct state or local rate for the type of tax you have to track. Then, decide the tax agency that you send your tax payments to. For more info, please visit our Set up and use the automated sales tax feature page.

If you’re unsure about the correct rates, you may check your tax authority’s website, or consult your accountant. If you don't have one, here's how to find one near you.

Also, you may pull up the Sales Tax Liability report to get a detailed look at the taxes you owe. This is to make sure everything is correct before you file and pay your sales tax return.

Should you need anything else, don't hesitate to comment below. I'm always around to help. Stay safe and take care always.

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