HOW TO CHANGE SALE TAX RATE?

Edit your sales tax item and change the rate.  Start on the Items list.

Hello, dynatest.

It's easy to change the sales tax rate in QuickBooks. Here's how:
1. Go to Lists in the top menu bar, then Item List in the drop-down.
2. Find the one you need to edit, right-click it and choose Edit Item.
3. Change the Tax Rate.
4. Select Ok to save your changes.
It's that simple! Once you've done this, it should be reflecting the updates you made.

​Additionally, here's a helpful article about editing items: Add, Edit or Delete Items

If you have any questions don't hesitate to reach out, I'm just a post away.

I'm trying to change the tax rate on a Sales Tax and there is no option to change the rate.  

I understand the impact of Sales Tax on your business on a daily basis, @SHELLEYD75. I'm here to ensure you have it updated in QuickBooks Desktop.

It's possible that you select a Non-Sales Tax Item, that's why you're unable to see the option to edit the rate. Don't worry, I'll walk you through the detailed steps to successfully modify it:

1. Open the Lists menu and click on Item List.

2. Find your Sales Tax Item that you need to change.

3. Right-click the item and select Edit Item.

4. Modify the Tax Rate.

5. Once done, click on OK.

That's it! You should be able to have an updated Sales Tax rate. 

I'll also add this helpful module to learn more about keeping track of taxes reports: Review sales tax reports in QuickBooks Desktop.

Please let us know if you need anything else about handling taxes or QuickBooks. It's always our pleasure to be of help. Take care and have a good one!

This is fine to "edit" your sales tax rate but you do realize once you have done that it changes ALL PREVIOUS invoices to this rate? The question pops up that asks if you want to change this rate for all PAST AND FUTURE invoices. 

It also changes all past sales tax reports. I was told to create a new sales tax item for the new rate and then apply to current invoices, but select NO when asked if I want to update customer past and future transactions to this rate. 

Am I incorrect in this ? I use quickbooks desktop enterprise 2024. Is there a way to apply the new rate to my customers but only for FUTURE transactions. ? I have looked and found NOTHING to help on this.  

The last time I EDITED sales tax rate (2018), applied to all past and future transactions and then was audited and could not produce accurate sales tax reports for the past period because the rate had been changed. Cost my client a cool 10K. 

So that is when I was told to create a second sales tax item with the new rate. BUT now its asking to change all past and future transactions to this rate. Do you have a better answer to this ? 

thank you 

Karen EA2u

Hi, Karen. Thank you for reaching out with your question about updating sales tax rates in QuickBooks Desktop Enterprise (QBDT). I understand your need to keep historical data accurate while adjusting future transaction rates. Let me provide some insight into this update.

When you create a new sales tax item in QuickBooks Desktop Enterprise, it only affects future transactions. Ensure you select it exclusively for new invoices and avoid updating existing transactions with this rate. Additionally, be careful not to select options that could apply the rate retroactively to previous transactions. 

Here's how:

1. Navigate to Lists at the top menu, then select Item List.
2. Right-click in the Item List area and choose New.
3. Choose a Sales Tax Item and complete the necessary details for the new rate.
   
   
4. Click OK to save the item.

It’s important to note that when you edit the taxability of an existing transaction, a prompt will appear allowing you to decide whether to update past and future transactions. When QuickBooks asks if you want to update all past and future transactions, select No to ensure that only new invoices are calculated at this new rate.

Additionally, creating a new sales tax rate item might complicate the continuity of your reporting and make monitoring tax payments over time more difficult.

To give you thorough information on how you can adjust your sales, consider reading this article: Set Up Sales Tax In QuickBooks Desktop.

Furthermore, QuickBooks provides different reports that cater to your business needs. Check out this article for more information: Understand Reports.

If there's anything else I can assist you with regarding the sales tax rate, please let me know by using the Reply button below. I'll be here, ready to help you. Take care and stay safe!