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Set up where you collect sales tax in QuickBooks Online

SOLVEDby QuickBooksQuickBooks Online368Updated March 09, 2022

Learn how to set up where you collect sales tax for the first time in QuickBooks Online.

QuickBooks Online keeps track of your state's tax laws to accurately calculate sales tax and returns. All you need to do is tell QuickBooks where you collect sales tax.

Note: This article is for automated sales tax (AST) users. If you still use manual sales tax, check if you can now switch to AST. If you don’t have the option to switch, don’t worry. It should be available to you soon.

Step 1: Check your business address

Make sure your business address is correct, so QuickBooks can set up the right tax agency for you.

  1. Go to Taxes.
  2. Select Get started.
  3. You'll see your business name here if you updated your business info in Settings ⚙. If not, select Edit ✎ to add your business address.
  4. Review your address and then select Next.

Note: In your next invoice or sales receipt, QuickBooks will automatically use your business address as the sale location. If you need to, you can always change the location on the transaction.

Step 2: Add multiple tax rates and agencies

QuickBooks automatically locates tax names and rates according to your business address. You just need to match the tax agency for each rate.

  1. Select the TAX RATE NAME checkbox that applies to your business location.
  2. Select the OFFICIAL AGENCY NAME dropdown menu, then select the appropriate agency for the tax name.
  3. Select Next.
  4. Review your rates. If the rates are correct, select Save.
  5. Once you have set up your sales tax, select Continue.

Step 3: Tell QuickBooks how often you file

You’re almost finished. Just make sure to set up your filing frequency so QuickBooks can remind you when it’s time to file.

Note: Not sure how often you should file? Check your sales tax business registration or go to your tax agency’s website to know your filing frequency.

  1. Select the Filing frequency ▼ dropdown, then choose how often you file.
  2. When you’re done, select Save.

That’s it. On your next invoice or sales receipt, QuickBooks will do all sales tax calculations for you. Check out how QuickBooks automates sales tax calculations.

Add a new tax rate and agency

If you charge sales tax outside your state, you can add other tax agencies you pay. Here’s how to add or edit sales tax rates and agencies.

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