Turn off Automatic Sales Tax

Good day, hillsideplumbing.

I’m happy to share my thoughts about your sales tax concern. This way you can process all your sales tax correctly.

Here’s how:

1. Go to the Gear icon.
2. Click on the Accounts and Settings.
3. Choose the Advanced tab, then click on Accounting, right under default tax rate selection you can select whether Exclusive of Tax or Out of scope of Tax.
4. Lastly, click on save and then done.

Here’s how you can set up your sales tax properly.

I’ll be more than glad to answer your additional queries with sales tax. Thank you.

How do I get more help in this area?  I have had an outstanding issue with Quickbooks for several months that no one has resolved.  As I continue research on my own, I believe that automatic sales tax in QB is causing discrepancies resulting in invoices from website sales (through OneSaas) not being pushed through to QB.  This is causing a business disruption.  I have even hired a consultant who hasn't provided any help in getting the situation resolved.  Please help!!

Thanks for joining on this thread, @michelle144.

This is not the impression I want to you feel about the automated tax feature in QuickBooks Online (QBO). 

QuickBooks will always depend on what OneSaas share with us and how they posted online. I'd recommend communicating with OneSaas support to check your invoice transaction discrepancies. They can also review your account settings and provide troubleshooting steps to isolate the issue. 

I'd also encourage you to visit this article about how automated sales tax is calculated in sales transactions: Use automated sales tax on an invoice or sales receipt.

Additionally, please browse these articles about customizing reports and the common question in sales tax.

• Customize reports
• Sales tax in QuickBooks
• Reports included in your QuickBooks Online subscription

Let me know in the comments section how the call goes. I'm always here, willing to help more. Be safe.  

I tried going to account settings, advanced but my only choices are 

First month of fiscal year

First month of income tax year

Accounting method

and close the books

I don't have any options to turn off the automaton.

You're unable to turn off the automated sales tax in QuickBooks Online, pitkrew.

Just make sure your products and services aren't taxable. To check this, you can open each item and categorize it as nontaxable if you aren't collecting sales taxes from customers. 

Let me show you how:

1. Select Sales, then Products and Services.
2. Locate the item, then click Edit.
3. Select Nontaxable from the Sales tax category section.
   
4. Click Save and close.

You can go back to the same steps if you need to take taxes from customers.

I'm adding these articles for additional guide:

• Add sales tax categories to your products and services
• Use automated sales tax on an invoice or sales receipt.

Let me know if you have follow-up questions about this commenting below. I'll be right here to help you.

I'm having the same issue - OneSaas pushes the correct data from Shopify to QBO but QBO Automatic Sales Tax then doesn't apply it to the correct state nor to the correct tax payable account.  The issue is with QBO Automatic Sales Tax not with OneSaas!!!

So the question is what happens to the data once it hits QBO?  How does QBO "Automatic Sales Tax" determine the sales tax account it applies the data to and why isn't it consistent?  Example, TN sales tax collected was going to the TN sales tax payable account yet yesterday's TN sales tax collected went to a random new liability account that QB added without my permission entitled "Out Of Scope Agency Payable".   I do not appreciate QBO randomly adding accounts in MY BOOKS.   The biggest question is WHY QBO will not allow its CLIENT to disable features that don't work?  QBO has no responsibility to any taxing authority, the QBO client does!  Automatic Sales Tax is a NIGHTMARE that causes hours of unnecessary work.  Either fix it so it works correctly according to what the QBO Client needs or afford us the luxury of disabling it!  

The automatic sales tax function in QBO just added a ton of new accounts in the Chart of Accounts and I cannot deleted them.  What the heck?  I either need to disable this feature or find a way to disable those accounts, they are mucking up my data.  It is NOT feasible to go through all the customers, all the products and mark tax exempt/non taxable but even doing so, will that remove all the unnecessary state and city payables accounts?????

Thanks for joining the thread, @kathRSC. I can share a few details about exemption from state taxes and city payables accounts.

Yes, you're correct. Making the products and services nontaxable and set each customer's tax info to tax-exempt will help you not collecting taxes for the state and city sales taxes.

Here's how:

Products and services

1. Go to the Sales menu and then select Products and Services.
2. Click Edit from the Action column.
3.  From the Sales tax category section, select Non-taxable.
4. Hit Save and close.
   

Customer

1. Click Sales on the left menu and go to the Customers tab.
2. Choose a customer profile and click Edit.
3. In the Customer information window, go to the Tax info tab.
4. Make sure to remove the checkmark in the This customer is taxable box.
   
5. Enter the Exemption details.
6. Click Save.

In addition, you can uncheck the Tax column from all of your sales forms (like invoices, credit memos, and sales receipts) so QuickBooks won't calculate sales taxes. See the screenshots below:

Also, if you want to turn off the automatic sales tax feature, make sure to edit QuickBooks' previous invoices, credit memos, and sales receipts and then uncheck the Tax column for each line item. Products and services are set up to be nontaxable and the customer's tax info is tax-exempt at the same time.

You can follow the steps below to turn off sales tax:

1. Go to the Taxes menu and then select Sales tax.
2. From the Sales Tax Center, go to Sales tax setting.
   
3. Select Turn off sales tax.
   
4. Choose Yes to confirm.
   

I've added some articles for more details about setting up sales tax and how QuickBooks compute sales taxes:

• Learn how QuickBooks Online calculates sales tax
• Set up and use automated sales tax in QuickBooks Online

In case you want to turn it on again, simply go to the Taxes menu and use the automated sales tax feature.

Feel free to leave a comment if you have additional questions about sales taxes or any QuickBooks concerns. I'm always ready to help you here. Have a great weekend!

Was the issue with OneSaas and Shopify automatic sales tax resolved? OneSaas says to turn off automatic sales tax but leave sales tax turned on. I see no way of doing that. If the sales tax is turned off OneSaas won't let you map the sales tax line item from Shopify, but if automatic sales tax is turned on, it still won't let you map the sales tax. How do I keep sales tax manually turned on?

Thanks for joining this thread, RuthSc.

To identify if an issue with OneSaas and Shopify has been solved, I'd recommend getting in touch with one or both of the particular companies. They'll be able to guide you through how they'd recommend setting up your books to function properly with their services. They also have detailed resources on their websites about how it all works.

You'll also be able to find many detailed resources about using QuickBooks in our help article archives.

Please don't hesitate to send a reply if there's any additional questions. Have a wonderful day!

Is there a way to turn off Automatic Sales Tax without turning off Sales Tax? The instructions listed must be for an older version of QBO. I don't want QBO to automatically charge sales tax for each Invoice. I want to have a drop down like QBD has. Is there a way to QBO set up for sales tax but just not do it automatically?

Thanks for getting back here, @RuthSc. I've come to provide additional information about your sales tax concern.

In QuickBooks Online (QBO), once you turned on the automated sales feature you can no longer turn it off. To get more information about how automated sales tax works in QBO, feel free to visit this article: Set up and use automated sales tax in QuickBooks Online.

As a workaround, you can deselect the product and services from being taxable to prevent collecting tax when creating an invoice. You can also make your customer's tax-exempt. To do so, you can follow the steps outlined by my colleague, Jovychris_A.

Reviewing your sales tax payable in QBO is a breeze. You can do this by running the Sales Tax Liability report. With this, you can ensure everything is correct before filing your tax return.

Don't hesitate to post again here if there's anything else you need to know about the automated sales tax feature. I'd be happy to assist you further. Take care always.

This sucks. I never turned on automatic sales tax, but 2 days also it started showing up on my estimates. I never invoiced with tax and now I'm stuck with it? 

Most customers are schools and tax exempt. I just updated ones info to tax exempt but QBO keeps adding sales trax to all the estimates. 

Hey there, JJG55.

If you haven't created invoices with taxes, you should be able to turn off the sales tax feature. Here's how:

1. Click Taxes in the left panel.
2. Go to Tax Settings.
3. Turn off the Sales Tax from there.
   

To know more about how sales tax works in QuickBooks Online, check out this article: Sales tax in QuickBooks Online. This will provide you links about paying and correcting invoices without taxes.

If you have any other concerns or questions, please don't hesitate to leave a comment below. I'm here to answer them for you. Have an awesome weekend ahead.

Non taxable isn't an option, everything defaults to taxable. As a general contractor, we don't charge sales tax. It's skewing my books

Whatever happened to the drop-down menu for sales tax? It has vanished. Now I cannot seem to get rid of the taxes for services. QBO wants to tax everything new and did not allow an option to not tax for services. The answer is a simple "Yes or No" for sales tax.

Thanks for joining this thread, muenstermann. I appreciate the image you've included.
 

When creating a service, you can edit its sales tax by clicking Edit sales tax.

After accessing your What kind of product or service is this? screen, you can make a service nontaxable by opening its Still don't see what you're looking for? drop-down, ticking Nontaxable, selecting Done, then Save and close.

I've included a detailed resource about working with sales tax which may come in handy moving forward: Add a sales tax category to your products & services

If there's any additional questions, I'm just a post away. Have a lovely day!

Well that's nice but IT DOES NOT WORK. The drop down does not give you the option of taxable or non-taxable. I've NEVER used taxable for anything as WE DON'T CHARGE SALES TAX. Its never been turned on. Now it can't be turned off.

I hear your sentiments, @me92. And I want to make it up with you by ensuring you get the right information and support about turning off the Automatic Sales Tax.

QuickBooks Online (QBO) lets you set your tax manually or automatically. Once you've chosen to set your tax automatically, the option to revert back to manual setup will no longer be variable.

Since you've mentioned it's never been turned on, I recommend checking your audit log. It could be someone logged in to your account and enabled the Automatic Sales Tax feature. Let me show you how.

1. Go to the Gear icon.
2. Select Audit Log.
3. Filter the User, Date changed, and Events tab.

You can also refer to this article for more details: Use the audit log in QuickBooks Online.

If this is not the case, I suggest contacting our support team. This way, one of our live agents can securely look into your account and check why the feature is turned on. They can also investigate why you don't have the Non-taxable option and provide additional steps on how to disable the feature. 

When everything is all in place, you might want to utilize this link on how to seamlessly file your 1099 in the future: Create and file 1099s using QuickBooks Online.

I'm all ears if you have any follow-up questions about sales tax in QBO. Just add the details in your response and I'll get back to you as soon as possible. Stay safe!

I appreciate you for performing the steps provided by colleague above, bec1210.

I'm here to provide some information about the Automated Sales Tax in QuickBooks Online. 

 If you've created a taxable transaction, we can no longer turn off the Automated Sales Tax option. However, we can manually remove the taxes on the transactions. All you have to do is deselect the TAX column. Then, Save and close.

Afterward, we'll have to modify the Sales tax category of the product and services to Nontaxable. This way, the system will not collect any taxes from the items.

1. Go to the Sales tab and then select Customers.
2. Click the Edit tab.
3. Open the Tax info folder and select the Default tax code.
4. Click on Save.

I'll be adding our resource page, so you'll be familiar with how QuickBooks manage your taxes:

• Learn how QuickBooks Online calculates sales tax
• Sales Tax Resource Page.

Reach out to me if you have additional inquiries about Sales Tax or any QuickBooks related. I want to make sure you're taken care of. 

I am having the exact same issue, we never turned the auto sales tax feature on because we are a general contractor and we don't collect sales tax, never have, and never will. I can't stand that QBO doesn't allow you to turn off features that we don't need and don't want. I've updated ALL of our services to non-taxable (which you could not have made more difficult to figure out how to do) and I've changed my customers to all be non-taxable and I STILL can't get rid of the tax information on my invoices! This is confusing to my customers and is so frustrating. It's bad enough that I can barely customize my invoices anymore but now you're adding things I don't want and making it impossible to remove them. PLEASE tell me a work around for this!!!

I came here to provide an answer about your sales tax concern, @Integrated2015.

In QuickBooks Online (QBO), the option to turn off the Automated Sales Tax feature is unavailable. Ensure that the items are not taxable and set customer as tax-exempt are the workaround recommended to isolate the issue. For the instructions, you can refer to the outlined steps added by my colleagues in the previous replies in this thread. 

You can also run the Sales Tax Liability report to view your tax information in QBO. This report shows the summary of your taxable and non-taxable sales as well as the total sales tax collected from customers.

If you have any other concerns about sales taxes in QBO, feel free to post here again. I'd be happy to assist you once more. Take care always. 

You don't seem to understand what the issue is. I never authorized or turned on the Automated Sales Tax feature and I want it turned off. The tax line item will NOT go away even though I wasted hours changing my customers all to non-taxable as well as our services. I do not want the line item showing up on my invoices. I went through my audit log and nowhere did we turn on or set up the Automated Sales Tax feature, in fact up until this week none of our invoices had this problem. I am attaching a screenshot for you to visually see what I am talking about. I need to be able to remove this line item from my invoices- my customers aren't billed this way.