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Level 1

How to add enviroment tax

1 Comment
QuickBooks Team

How to add enviroment tax

Hi there, 

Taxes are an inevitable part of running a small business. If you need to add an environment tax, you can create a custom tax code in QuickBooks Online. You can do this in just a few clicks. I'll explain the steps below. 


Here's how to add a custom tax in QBO:

  1. From the left menu, select Taxes.
  2. Select Sales Tax at the top. (Tip: If you use payroll in QuickBooks Online, you may need to select Sales Tax as opposed to Payroll Tax.)
  3. Select Manage sales tax.
  4. Locate the sales tax agency you wish to add the new rate for, and select Add custom rate.

Here's a few things to keep in mind regarding custom tax codes:

  • this option is rarely used, since any code recorded this way will explicitly not report to any Federal or Provincial Tax Agencies (i.e., Canada Revenue Agency, Receiver General, etc), and won't help with filing/reporting to these types of agencies
  • you can add a tax in this category specific to your industry, such as tobacco, hotel, or gasoline tax. It could also be used to track sales to U.S. customers. Another use could be to set up a proper “out-of-scope” tax code to indicate that the sale/expense doesn't fall under any tax, if the company doesn't have one for any reason.
  • custom tax must be in a percentage format, not a particular dollar amount

For more information about adding taxes to QuickBooks Online, take a look at this comprehensive article: How to set up a new sales tax code.


If you have any other questions, please don't hesitate to reach out to our tech support team.