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what is the difference between Taxable Sales and Tax Amount?

Hello! I just want to know  how does Quickbooks do to calculate it? and why the amounts change every month. 

 

Thank you all in advance!!

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Best answer June 24, 2020

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what is the difference between Taxable Sales and Tax Amount?

I'm here to provide the difference between the amounts under the Taxable Sales and Tax Amount columns in QuickBooks Online (QBO), @Katherine1996

 

The Taxable Sales column refers to the original price of a transaction. The Tax Amount line displays the product of the taxable sales figure and its tax rate. Let's run the Sales Tax Liability report to dig them deeper. Just go to the Taxes or Reports menu to access it. Then, select any tax amount. It will open a transaction report that shows how much tax you charged in each sale.

 

For example, the original price of my invoice dated 04-01-2020 is 7,200.00, and it appears under the Taxable Amount column. Please take note that this is similar to Taxable Sales in the Sales Tax Center. Then, I'll multiply it to the tax rate of my agency (San Domingo), which is 7.75%. The result will be 558.00 under the Tax Amount line. I've attached a screenshot below on how it looks like in the program.

DifferenceBetweenTaxableAmountAndTaxAmount.PNG

 

The amounts will also change every month. It's because we calculate the total tax rate for each sale based on the three factors below: 

  • Your customer’s tax status
  • Location where you sell and ship
  • Your product/service's tax category

 

For more information, check out this article: Learn How QBO Calculates Sales Tax

 

I recommend clicking a link below, depending on the sales tax feature you're using in QBO. It provides you more details about collecting, reporting, paying, and filing your sales taxes to the appropriate agencies. 

 

I'll be right here to help if you need further assistance. Enjoy the rest of your day, @Katherine1996.

View solution in original post

1 Comment
Highlighted
Moderator

what is the difference between Taxable Sales and Tax Amount?

I'm here to provide the difference between the amounts under the Taxable Sales and Tax Amount columns in QuickBooks Online (QBO), @Katherine1996

 

The Taxable Sales column refers to the original price of a transaction. The Tax Amount line displays the product of the taxable sales figure and its tax rate. Let's run the Sales Tax Liability report to dig them deeper. Just go to the Taxes or Reports menu to access it. Then, select any tax amount. It will open a transaction report that shows how much tax you charged in each sale.

 

For example, the original price of my invoice dated 04-01-2020 is 7,200.00, and it appears under the Taxable Amount column. Please take note that this is similar to Taxable Sales in the Sales Tax Center. Then, I'll multiply it to the tax rate of my agency (San Domingo), which is 7.75%. The result will be 558.00 under the Tax Amount line. I've attached a screenshot below on how it looks like in the program.

DifferenceBetweenTaxableAmountAndTaxAmount.PNG

 

The amounts will also change every month. It's because we calculate the total tax rate for each sale based on the three factors below: 

  • Your customer’s tax status
  • Location where you sell and ship
  • Your product/service's tax category

 

For more information, check out this article: Learn How QBO Calculates Sales Tax

 

I recommend clicking a link below, depending on the sales tax feature you're using in QBO. It provides you more details about collecting, reporting, paying, and filing your sales taxes to the appropriate agencies. 

 

I'll be right here to help if you need further assistance. Enjoy the rest of your day, @Katherine1996.

View solution in original post

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