As long as you enable tax calculation and select AvaTax as the tax calculation method in your business application, AvaTax automatically calculates a sales or use tax rate on a variety of transaction types according to the taxability rules of those products (exempt customers aren't charged sales tax).
Calculate tax on a document
To calculate sales tax on a document in QuickBooks Online, follow these steps:
- Create the document and add all the relevant details.
- To ship the items, add the Billing address, Shipping address, Ship via, Shipping date, and Tracking no. details. Type the shipping charges in the field next to Shipping. The shipping charges are considered as a new line item and assigned the tax code as FR. When adding a ship-to address, it's best to add the address to the customer record before creating a document referencing that ship-to address.
- To enable tax calculation for an item, select the Tax field for that line. If the Tax field for a line is not selected, then the item is considered as non-taxable and the corresponding tax code sent is NT.
- To add a discount, add a line item with the value of the discount to
- To add a new line item, click Add lines.
- To remove all line items, click Clear all lines.
- To add a subtotal item, click Add subtotal. While calculating sales tax, AvaTax does not consider a subtotal item. You can add a subtotal item only to invoices and estimate transactions.
- To calculate tax, add the relevant details and click one of the following:
- Estimate Tax: Calculates the sales tax for this document and adds a new line displaying the sales tax. These details are not sent to AvaTax.
- Save: Saves the document, calculates tax, and adds a new line displaying the sales tax, and sends the details to AvaTax.
- Save and Send: Saves the document. After the document is saved, Connector for QuickBooks Online calculates the sales tax and sends the details to AvaTax. Click Save before clicking Save and Send to ensure calculated tax is applied to the invoice.
Schedule a document (recurring invoice)
- In QuickBooks Online, create the recurring invoice as usual.
- In the Recurring Invoice window, under Options, do not select Automatically send emails. Invoices with this option selected might be sent without taxes calculated and listed on them.
The recurring document is generated as scheduled and a status email is sent to the registered customer.
Void or delete a document
Whether you void or delete a document in QuickBooks Online, the transaction displays as "voided" in AvaTax.