When sales tax is turned off:
- All of your historical sales tax data is saved for you, such as sales tax on transactions, tax agency info, and your sales tax liability.
- Sales tax is still shown on past transactions for reporting purposes so that your books are correct.
- If you have any recurring invoices, the sales tax will no longer be calculated going forward.
- If you later decide that you want to use sales tax, you can turn it on again.
Your tax agencies
When you turn off sales tax, all your tax agencies are set to inactive. This means that you'll stop collecting tax for each agency you’ve set up in QuickBooks Online. If you need to deregister with any of your sales tax agencies, you'll need to contact them directly.
All your tax agency info will be saved in case you want to turn sales tax back on later. You can see the tax agency info in the table (all the data that was on the tax agency card).
Note: If you turn sales tax back on, tax agencies won’t be turned on automatically and you’ll need to:
- review the states you currently sell into, and
- turn on any agencies you’re registered with.
Your sales tax liability reporting
All your sales tax liability reporting will still be available when you turn sales tax off. For example, each tax agency will be shown under Other Current Liabilities on your Balance Sheet (whether you still owe sales tax or not).
Your custom rates
Any custom rates you’ve set up will remain active when automated sales tax is turned off. But you can't add any custom rates on invoices or sales receipts as the tax fields will no longer appear when sales tax is turned off.
Turn off automated sales tax
Here’s how to turn off automated sales tax:
- Go to Taxes, then select Sales tax (Take me there).
- Select Sales Tax Settings.
- Select Turn off sales tax.
Select Turn off to confirm.