To sync invoices from QuickBooks Online (QBO), you must have sales tax enabled. If sales tax is not enabled, invoices will not push to QBO (but bills and expenses will continue to push as normal).
To do this, you'll enable Automated Sales Tax (AST).
If for any reason you want to turn AST off, we advise reviewing QBO's help doc about how to turn it off before officially switching this feature off.
Enable QBO sales tax
On your left menu in QuickBooks Online, go to Taxes, then select Sales Tax.
Select either Use Automatic Sales Tax or Get Started.
Confirm your business address, then select Next.
If you have any existing tax rates, match them to the correct official state agency.
NOTE: You must have established tax for each agency that you do business in. Each project address's state must be listed here.
Select Next.
Review the rates, then select Save.
You should now see one (or more) Tax Agencies in your Sales Tax tab. Make sure that you create an agency for each jurisdiction that your project addresses are in.
If you've already connected your QuickBooks Online account to BuildBook, you'll need to manually refresh the connection to check for AST in BuildBook. Do this by clicking the Check Again link on the QuickBooks Sync settings page.
Using Custom Rates
BuildBook can apply custom tax rates created in QuickBooks Online to your budgets and invoices.
Custom rates can be used when location-based tax doesn't apply to a project or when a project doesn't yet have a valid address.
To create a custom tax rate, start by establishing the rate in QuickBooks Online under Taxes > Sales Tax > Sales Tax Settings. Custom Rates appear at the bottom half of the page under the Custom rates header. New rates can be added with the Add rate button in the top right. These rates can then be applied to the budget just like the location-based AST rate.
If you don't collect tax
There are still a few ways to avoid unnecessary tax being applied to your products and services.
Skip the "Tax" checkbox
You can mark all of your products and services as non-taxable and more or less "bypass" the system. If an item in BuildBook doesn't have the "Tax" checkmark selected on the invoice, it won't be taxed in BuildBook or QuickBooks Online.
Additionally, assuming your locality doesn't require tax on the exact types of goods and services you're selling, QBO will report back $0 tax.
Create a 0% custom rate
You can create and apply custom rates from QuickBooks Online in BuildBook.
To create a custom tax rate, start by establishing the rate in QuickBooks Online under Taxes > Sales Tax > Sales Tax Settings. Custom Rates appear at the bottom half of the page under the Custom rates header. New rates can be added with the Add rate button in the top right. These rates can then be applied to the budget just like the location-based AST rate.
Modify your products and services
QuickBooks provides several options and settings on products and services that can impact their tax status. Some of these options are outlined in the section below.
Manage sales tax on products and services
First, remember that products and services map to your Cost Codes. Any Cost Codes you use in BuildBook will be pushed to QBO as products and services on your bills, expenses, and invoices. These products and services have many configurable tax options within QBO.
Always talk to your bookkeeper or CPA before making adjustments to your tax system or taxable status to ensure you comply with your localities' requirements.
Open a product or service by going to Sales > Products and Services > Edit. Each product/service has a section in the middle for Sales tax. Sales tax options can be edited with the blue Edit sales tax button.
We recommend leaving your taxable items as Taxable -- based on location only for best results. This allows QBO to use its internal Automated Tax System (ATS) to generate the most up-to-date tax for that item.
Additional options can be found under the Browse all section. Most of our customers who use this option select their tax category in the Construction section.
Troubleshooting taxes in a BuildBook invoice
For items to have sales tax in QuickBooks Online, they must also have a tax rate applied in BuildBook (by checking the "Tax" checkbox). Then, when an invoice is changed to Paid or Open, BuildBook updates the estimated tax to the actual tax based on what QuickBooks calculates.
You can see this in the activity log on each invoice in BuildBook:
QuickBooks Online provides more information on how their Automated Tax System calculates this tax. To view their calculation:
Locate the invoice in QuickBooks Online
Select Edit on the right-hand side of the invoice's row
Scroll down to find the tax rate and select See the math under the tax value
You can now view the tax rate calculation in QuickBooks Online. Note: editing the tax rate here won't reflect in BuildBook.
What if I don't want to use tax in this way?
If sales tax is not enabled, invoices will not push (but bills and expenses will continue to push as normal). Enabling sales tax is ultimately optional and should be discussed with your bookkeeper or CPA.
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