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Why do I need to choose a sales tax category?

 
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Last update:
‎April 03, 2019 02:19 PM
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I think choosing a safe price for company product has a huge effect on the sales tax because.of market inflation and life of product it is important to aim low and sell high also if a product is expected to sell big time there should be a steady sales tax on the ticket item because of consumer relations to the product. Assuming someone wants to buy your product and the competition has the same product you would want to have a reasonable sales tax so that the consumer will have something to remember and will want to keep up with as regards to shopping at their favorite stores

Hey there, KyleMcDougall.

 

Thanks for bringing your question forward here in the Community. I'd like to provide some info about choosing sales tax categories in QuickBooks Online.

 

I think phillipblake021 offered some great insight. In addition to what he mentioned, I have an article for you that covers even more info on sales tax categories. The write-up explains the purpose of the categories is so you can track sales tax more accurately. The post also explains, "Rules for how to tax a product or service can change depending on what you sell and where you sell it. QuickBooks keeps track of all those tax rules so you don’t have to."

 

You can read up on the details by visiting this link: Add sales tax categories to your products and services

 

I hope this info answers your question about why the categories are needed. To find out more about assigning which category to which product or service, I recommend asking your accountant to be sure. If you don't currently have an accountant, you can find one in your area with a quick search on the ProAdvisor site. ProAdvisors are trained and certified in the workflows of QuickBooks, and would be able to answer any specific accounting questions. 

 

You're always welcome here in the Community as well. I'll be here to help in any way that I can.

 MorganB:

The write-up explains the purpose of the categories is so you can track sales tax more accurately. The post also explains, "Rules for how to tax a product or service can change depending on what you sell and where you sell it. QuickBooks keeps track of all those tax rules so you don’t have to."

 

As soon as I read the part  "QuickBooks keeps track of all those tax rules so you don’t have to."   I was SOLD! 

Thanks so much for sharing this. I'm sure I'll refer back to the link more than once. :) 

 

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