Will turning off “Shipping” adversely affect our books?

The thorough explanation you've shared regarding your sales tax calculation problem is indeed helpful, Justine. Let's break down how you can handle this situation.
 

Beforehand, did you encounter an error notification when generating an invoice? Any sales tax-related notifications appear at the top portion of an invoice.

To confirm, I recommend creating a dummy invoice to identify the root cause of the issue. Please know that if QuickBooks isn't able to validate the customer's shipping address, your sales tax will be automatically calculated based on your company's address (Ship From).

If you received the We can't validate this shipping address, so we've based the sales tax calculations on your business address notification, double-check the customer's Ship To address. Ensure you've saved the accurate location to let QuickBooks calculate the sales tax correctly.

On the other hand, if you encountered the Can't Calculate sales tax error, you'll have to click the Set up new sales tax agency link to resolve this matter:

After that, follow the on-screen process to start collecting taxes based on the customer's location. Furthermore, it's essential to note that once you modify the shipping information or set up a tax agency for a specific address, you'll also have to edit your existing transactions to apply the changes.

However, if the issue persists, let's verify if this problem is caused by exercise data build-up, as this could affect the platform's performance. To do so, kindly open your account using a private browser.
 

Here's how:

• Mozilla Firefox: Ctrl + Shift + P
• Microsoft Edge: Ctrl + Shift + N
• Google Chrome: Ctrl + Shift + N
• Safari: Command + Shift + N

If the sales tax is accurately calculated when using the private session, revert to your regular browser and clear its cache and cookies. Initiating this could help QuickBooks reestablish its full functionality. When the problem continues, consider using another supported browser.

Alternatively, you can copy the Ship To information and paste it on the Ship From address to narrow down the result.

Meanwhile, turning off the Shipping feature does not directly affect your books and will only apply to future transactions. Still, it would be best to seek advice from an accounting professional to gather more insights about sales tax management.

Finally, I've included some articles you might find handy once you need to modify your sales forms, generate sales tax adjustments, or collect payments from your customers:

• Customize invoices, estimates, and sales receipts in QuickBooks Online
• Create or delete a sales tax adjustment in QuickBooks Online
• Record invoice payments in QuickBooks Online

Please let us know if you've received a different error code from what I mentioned above or if you have other questions about your sales taxes. Our team is always here for you.

@Ivan_G, thank you for the reply. Yes, the issue is We can't validate this shipping address, so we've based the sales tax calculations on your business address notification. This only occurs when the client shipping address is missing. When creating a client, we use the checkbox "Shipping address same as billing", but for whatever reason there are times when the shipping address is missing when an invoice is created, we then have to copy and paste the shipping address, refresh the invoice, etc.. It is extra steps we would like to avoid. Since we do NOT ship anything to anyone, we were hoping that turning off Shipping would force QB to use the billing address to calculate the Sales Tax and we could avoid the shipping address issue all together. We were just concerned about what this would do to our books.

We understand and are very familiar with Sales Tax, navigating the QB Sales Tax functionality is our issue. We know how to set up new tax agencies in QB. Do you know if turning off “Shipping” will force QBO to only use the client billing address or will QB continue to look at the ship from address because there is no ship to address?

Thanks,

Thank you for providing a well-detailed explanation about the calculation of Sales tax not based on your client's billing address, Justine. Turning off the Shipping button in Settings is not the option to calculate the Sales tax based on the billing address of your client. I'll provide you an explanation with this.

With this case, QBO will not calculate sales tax based on your customer's billing address. If there is no Shipping address turned on or entered in the customer's profile. QBO Automatically calculate the sales tax based on the location of the sale which is your business address.

Please refer to this article to learn more about adding the  shipping addresses of your customer: Add a customer’s shipping address to invoices in QuickBooks Online.

After all of this is through, you can receive a payment from your customers if they already paid for your products.

These will help you to have the Sales tax calculation will be based on the billing address of your customer. If you encounter any issues or have additional questions, please hit the Reply button to assist you promptly.

Hello @EmaicaD. Yes, we know how to add a shipping address to a client. As I've stated, we do NOT ship anything. We use the "Same as billing address" checkbox so we don't have enter the same address twice. 

You stated "Under Shipping address, if the Same as billing address is checked, kindly uncheck it to provide a separate shipping address." I'm not sure why you want us to enter the same address twice. Using the check box usually works. Your instructions seem like an unnecessary step, give that we don't need or use shipping addresses because we don't ship anything to anyone.

What I'm hearing is there is no solution to this random issue, turning off Shipping will not help. We will just have to continue dealing with the shipping address issue as it presents itself. 

We did find that when we selected to show the shipping address on the Invoice Sales Form set-up, this issue occurs less often now. We don't like having the shipping address on the invoice because it is just a duplicate of the billing address and it clutters the look of the invoice, but this did help. I think the issue mostly happens with older clients we haven't billed since we turned on Sales Tax.

Thank you for the information, unfortunately it did not solve our issue, but may be useful to someone else.

@EmaicaD I forgot to mention, we are not trying to base Sales Tax on the client's shipping address (because we don't ship), we are trying to base it on the client's billing address. 

Thanks,