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Level 4

Calculating tax on bills in quickbooks online

We have to pay our supplier against certain service. The physical invoice we receive from supplier contains three lines. 

1. Amount against service (will be paid to supplier), 

2. Provincial Sales Tax (that will be included in bill and will be paid to supplier), and 

3. Federal Sales Tax (that will be paid to the Tax agency - NOT to supplier)

Please guide how to record such bills in quickbooks online

Solved
Best answer September 26, 2019

Best Answers
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QuickBooks Team
QuickBooks Team

Calculating tax on bills in quickbooks online

Hi there, abr_ora.

 

In QuickBooks Online (QBO), you can set up the Provincial Sales Tax as a Custom tax. Then, choose the This tax is collected on purchases option to include the sales tax when creating a bill.

 

Just follow the steps below on how to add a custom tax:

 

  1. Click Taxes in the left menu.
  2. Click the Add tax button.
  3. Choose Custom tax.
  4. Fill out all the fields needed in the Add tax panel.
  5. Place a checkmark for This tax is collected on purchases option.
  6. Enter the rate in the Purchase rate field.
  7. Place a checkmark for Purchase tax is reclaimable option if it is reclaimable.
  8. Click Save.

Once done, create a bill and enter the amount against the service. Then, choose the Provincial Sales Tax rate you've set up in the Tax column.

 

For Federal Sales Tax that will be paid only in the tax agency, I'd suggest consulting your accountant on how to properly record it in QBO.

 

I have articles here about Sales GST/VAT:

 

Please reply to this post by adding some details below if you need anything else with Sales Tax. I'm here to help.

View solution in original post

3 Comments 3
Highlighted
QuickBooks Team
QuickBooks Team

Calculating tax on bills in quickbooks online

Hi there, abr_ora.

 

In QuickBooks Online (QBO), you can set up the Provincial Sales Tax as a Custom tax. Then, choose the This tax is collected on purchases option to include the sales tax when creating a bill.

 

Just follow the steps below on how to add a custom tax:

 

  1. Click Taxes in the left menu.
  2. Click the Add tax button.
  3. Choose Custom tax.
  4. Fill out all the fields needed in the Add tax panel.
  5. Place a checkmark for This tax is collected on purchases option.
  6. Enter the rate in the Purchase rate field.
  7. Place a checkmark for Purchase tax is reclaimable option if it is reclaimable.
  8. Click Save.

Once done, create a bill and enter the amount against the service. Then, choose the Provincial Sales Tax rate you've set up in the Tax column.

 

For Federal Sales Tax that will be paid only in the tax agency, I'd suggest consulting your accountant on how to properly record it in QBO.

 

I have articles here about Sales GST/VAT:

 

Please reply to this post by adding some details below if you need anything else with Sales Tax. I'm here to help.

View solution in original post

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Level 4

Calculating tax on bills in quickbooks online

Regarding Federal Sales Tax, please note that QBO is new for accountant. May you help here too...
Highlighted
QuickBooks Team
QuickBooks Team

Calculating tax on bills in quickbooks online

Hello there,  abr_ora.

We don't advise any accounting processes. You can provide this link to your accountant to learn more about getting started with Taxes/GST: <a rel="nofollow" target="_blank" href="https://community.intuit.com/browse/quickbooks-online-intl-taxes">https://community.intuit.com/brows...>.

Feel free to reply to this thread if you need anything else in QuickBooks Online.