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Aratay013
Level 1

I need excise tax at 4% and now QB only allows the state sales tax rate of 6.5%. Is there a way to fix that, other than override every invoice? I use automated sales tax.

 
2 Comments 2
Michael K
Moderator

I need excise tax at 4% and now QB only allows the state sales tax rate of 6.5%. Is there a way to fix that, other than override every invoice? I use automated sales tax.

Hey there, @Aratay013. Happy to provide some insight on the Automated Sales Tax System.

 

The automated system calculates sales tax based on tax tables provided to us by each state, and will use your company address by default. If you, however, have a shipping address on your invoice, it will calculate based on that address instead. I recommend checking to make sure this isn't the case on the invoices to make sure it's calculating based on the correct address. If you have a lower tax rate specifically for your state, you'll need to continue overriding them on invoices.

 

For more information, I recommend checking out: Set up and use automated sales tax in QuickBooks Online

 

Shoot me a reply if you have any other questions. I'm here for you. Have a wonderful day!

Rustler
Level 15

I need excise tax at 4% and now QB only allows the state sales tax rate of 6.5%. Is there a way to fix that, other than override every invoice? I use automated sales tax.

To answer your question, no there is not.  The automated sales tax app is just that, sales tax only.

 

Excise tax is not the same thing, so you have to manage it manually in QBO, and since QBO is lacking some functions that are in desktop, it is a mess of a work around

 

create the liability account, excise tax due

create a service item called excise tax, link it to the excise tax due account, and set the rate to 0.04, and set the item to non-tax (I don't imagine you are required to collect sales taxes on the excise tax)

 

On the invoice select the excise tax item, in the QTY block enter the amount subject to the tax.  

i.e.  if the taxable items total $234.45 the excise tax item would look like

 

excise tax, qty= 234.45, rate = 0.04, total = 9.38

 

Later when excise tax is due, enter the payment and use the excise tax due liability account as the expense (reason) for the payment

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