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Hi. Is there a way in which I can tell QuickBooks not to deduct basic tax from my income. My basic tax rate is already deducted by my contractor so QuickBooks is basically taxing income that is already taxed, I just want it to calculate any higher rate income.
Basically I want QuickBooks to know that my income is a gross income rather than net
Hello, Matt.
In QuickBooks, basically, everything you track for your business is automatically calculated in an income tax estimate.
QuickBooks gives you an estimate for federal income and self-employment tax. This is calculated by applying income tax rates to your total self-employment taxable profit from your business plus any personal income you entered from outside your business. Self-employment tax is calculated by applying Social Security and Medicare tax rates to your business taxable profit.
To ensure the accurate information in your book, I suggest consult a tax professional to help you with this.
For more details, please check out this article: Automatically estimate your income tax in QuickBooks Self-Employed.
Let me know if you need further assistance with this. I'm always around to provide answers and clarifications to your questions. Have a great day ahead and take care.
Hello Community users, we just wanted to jump in and add some detail on how income tax calculates based on other income in QuickBooks Self Employed.
In the cog in the top righ of Quickbooks Self Employed in the tax profile there is a section called personal allowance amount. The standard amount currently is 12570. If your PAYE is over that you can change the figure from 12570 to 0. It will then calculate the income tax based on you having no allowance left as well as transactions and how you have filled in the rest of the tax profile.
Any questions please feel free to ask.
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