• Russ Falls

Why Use QuickBooks Online for Sales Tax Management?

Sales tax management and accounting are the most challenging pain points for any small business, especially e-commerce businesses. The process is complicated, time-consuming, and risky.

Most businesses face challenges when it comes to managing books and sales tax. As a result, they often turn blind eye to sales tax management.

This is where QuickBooks Online(QBO) comes in to make things better for you. It provides business owners with the convenience to use an online platform to manage everything from invoicing to annual sales tax.

No matter if you are a sales tax single agent or multi-agent, a physical store or an online business, QuickBooks Online provides businesses with a convenient remote access option.

Benefits of Using QuickBooks Online

Let’s learn some of the many benefits QuickBooks offers to small businesses and online merchants.

Easy to Use

Unlike other traditional accounting programs, QuickBooks Online is easy to understand and use. It has an intuitive design and easy interaction that makes online sales tax management and other financial activities easy for you. Moreover, you can book an accountant online to do the bookkeeping job for you at an affordable cost.

No Need to Backup Data on Your Desktop

With QuickBooks Online, you don’t have to worry about losing your data. Since QBO is a cloud-based program, it automatically backs up everything you put in the program. Your company’s financial information is stored on Intuit’s servers.

Shared Data Access

QuickBooks Online makes it easy for you to share your company’s accounting tasks with others. You just need a username and password to access this could-based program. It means that anyone in your company with the login details can access your sales tax management on QBO without needing to be in your office or on a specific computer.

Moreover, you can choose its upgraded packages to add more users. It allows you to add multiple people to the program for different tasks. You accountants can also access the data to make sure the books are balanced and up to date.

Automated Invoices and Statements to Clients

If you are an e-commerce business, this feature is an ideal fit for your financial needs. The program automatically sends invoices and statements to your clients on regular basis. So, you don’t have to worry about printing out invoices at an additional cost and mailing them out to your client.

All you need to do is add the email address of the client you want to send invoices to the program and let QuickBooks handle the rest.

Receive Electronic Payments Directly

This is also an amazing feature for online sellers as it allows you to process electronic payments, such as ACHs, bank transfers, and debit or credit payments. So, you don’t have to visit banks, process checks, or manually input payments into QuickBooks.

Once your clients receive the invoice through QBO’s automated invoice system, they just have to click on the provided link and pay the amount. The system will instantly record the payments.

Customer Support is Available 24/7

Intuit’s online help desk is available round the clock to answer your queries. Their professionals are always available to assist you with general issues and help you use the program.

Some Other Benefits QuickBooks Online Offers:

1 The cloud-based program allows you to run reports from anywhere, anytime.

2 Apart from accounting, you can track the inventory with QuickBooks.

3 Certain transactions automatically load into the program and you just have to verify everything is correct.

Things You Need to Know About Sales Tax in QuickBooks Online

Sales Tax Rates Calculation

QuickBooks Online calculates sales tax rate based on:

What you sell- your products or services

Where you sell- varies from state to state

To whom you sell- if they have to pay sales tax or not. For instance, non-profit organizations are exempted from sales tax so you have to reflect this in QBO.

QBO Sales Tax’s Revamped Version

Intuit offers an innovative, more automated version of the sales tax. However, this feature only supports accrual accounting. Moreover, you’ll need the help of an expert accountant with the transition if you have just set up the sales tax and your situation is all complicated.

Creating Combined Individual Tax Rates

QuickBooks Online allows you to combine individual sale tax rates if you need to pay city, state, or country sales tax rates for a specific customer. QBO will track each invoice or sales receipt for payment and reporting purposes, whereas, the customer will see the total only.

Record Products and Services Sales Tax Information

This area requires some research to find out which services/products are subject to tax or not. You’ll need to figure out the rule for your product/service then record the status in QBO. Visit the state’s Department of Revenue/Taxation website to find this information.

QBO Tracks the Sales Tax You Owe

You can run a Sales Tax Liability Report to find what you owe to each agency and record what you have paid them. Quickbooks Online offers both detailed and summary versions of the taxable sales report.

QBO Tracks Your Payment Due Dates

Quickbooks Online helps avoid late returns and additional costs by tracking the due dates of your payments. It allows you to easily review the payment due to ensure accuracy and file your sales tax return on time. You can simply file returns to your tax agency either on their website online or by mail. You can then track the new payment due after filing a return.

If you are ready to set up your small business or you are already selling but struggling with sales taxes, QuickBooks Online is an ideal option for you. If you find it hard to use QuickBooks online for sales tax management, feel free to contact us. We can schedule an initial consultation and figure out how we can be of any help to you.

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