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Edit sales tax rate in QuickBooks Online

SOLVEDby QuickBooksQuickBooks Online218Updated 2 weeks ago

Learn how to edit sales tax rates in QuickBooks Online.

The amount of sales tax you collect may increase or decrease depending on the state where you conduct business. Update your sales tax rates to make sure you collect the right amount. Here’s how.

What happens when you edit a sales tax rate?

Here are a few things you need to know before you edit a sales tax rate.

  • When you edit a sales tax rate you use on templates, you need to select it again. Otherwise, it won’t apply any sales tax rate.
  • Reports show the data for both rates (before and after) if there are transactions for both rates in a particular period.

Edit your sales tax rate

When you edit a sales tax rate, all existing transactions that use the old tax rate remain the same. The updated sales tax rate only applies to new transactions. Here’s how to edit your sales tax rates.

  1. Go to Taxes.
  2. Under Related Tasks, select Add/edit tax rates and agencies.
  3. Select the rate you want to change from the Sales Tax Rates and Agencies table, then select Edit.
  4. Edit the tax rate you want. You can also change the component name if you like.
  5. Select Save.

Edit custom sales tax rates for automated sales tax

When you use the automated sales tax feature, QuickBooks automatically generates the tax agencies and sales tax rates you need. However, if you still use custom sales tax rates, here’s how you can edit them.

Note: We're rolling out a new sales tax system for all QuickBooks users. If you use manual sales tax, check if you can now switch over to automated sales tax. If you don't have the option to switch, don't worry. It should be available for you soon.

  1. Go to the Taxes menu, then select Sales tax.
  2. Select Sales tax settings.
  3. In the Custom rate section, find the sales tax rate you want to edit.
  4. Select Edit.
  5. Update the name or rate accordingly.
  6. Select Continue, then select Edit.

Get your books done right

Set up a live video appointment or message your QuickBooks-certified bookkeeper whenever you need help with new sales tax rates. Learn more about QuickBooks Live Bookkeeping.

What happens when you edit sales tax rate

  • When you edit a rate, you must set an effective date i.e date from which the new rate must be effective.
  • The new rate will be available for new transactions entered after the Effective date.
  • If you create a new transaction dated before the set Effective date, the transaction uses the old rate.
  • If you don't set an Effective date while editing a rate the earlier rate can no longer be used even for past dated transactions.
  • Existing transactions that used the earlier rate remain unchanged unless you edit the transaction and specifically select a different sales tax rate.
  • The new rate is available for new transactions only.
  • If you create a new transaction but use dates in the past, the transaction uses the new rate.
  • After you edit a rate, the earlier rate can no longer be used.
  • Existing transactions that used the earlier rate remain unchanged unless you edit the transaction and specifically select a different tax rate.
  • For recurring templates that use the changed component, new transactions created with the template use the new rate. Existing transactions created with the template and the earlier rate remain unchanged.
  • Reports show the data for both rates (before and after) if there are transactions for both the rates in a particular period.

Edit a tax agency name

You can edit your agency name to show correctly on your Taxes page only. If you would like to edit your tax agency's name, here's how:

  1. Then, choose VAT. In the top-left, select dropdown arrow beside Tax and select the correct agency.
  2. In the top right-hand corner next to Add tax, select the Edit (name of the tax agency) dropdown.
  3. Select Edit settings.
  4. Enter the new name, then select Save.

 
Note: Editing the Sales Tax Agency's name is possible through the Taxes page. However, the agency name that'll show on your sales forms would still be the old name or the initial name that you've entered. If you would like a different name to show on your sales forms, you'll need to create a new tax agency.

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