Tax Settings

In this help document, you’ll learn how to enable and apply Use Tax to transactions and set up Tax Overrides for transactions.

Use Tax

Use Tax applies to purchase transactions where goods are bought outside your state but used within it. When an out-of-state seller does not charge sales tax at the time of purchase, the buyer is required to report and pay use tax directly to the state. This ensures that purchases made from other states or online are taxed consistently with in-state purchases.

Here’s how you can enable use tax:

• Go to Settings in the top right corner of the page.
• Click Taxes under Taxes & Compliance.
• Go to the Tax Settings pane.
• Mark the Enable Use Tax in Purchase transactions checkbox.
• Click Save.

Now, with this option enabled, you can track and apply use tax in purchase transactions.

Apply Use Tax to Purchase Transactions

Here’s how you can apply use tax to purchase transactions:

• Go to the purchase transaction’s creation page.
• Click + New in the top right corner to create a new transaction.
• Enter the transaction details, and mark the This transaction is applicable for Use Tax checkbox below the Due Date.
• In the Items table when associating the tax, select the appropriate tax percentage from the drop-down.
• Enter the necessary details and click Save.

Now, the use tax will be applied to the selected purchase transaction.

Enable Tax Override

You can adjust the total tax amount in purchase transactions by enabling the tax override option. This feature allows you to edit and override the system-generated tax amount based on the specific county and state, as tax rates may vary. Here’s how:

• Go to Settings in the top right corner of the page.
• Click Taxes under Taxes & Compliance.
• Go to the Tax Settings pane.
• Mark the Override tax in purchases transactions checkbox.
• Click Save.

Now that you’ve enabled tax override for purchase transactions, you can modify the taxes at the transaction level.

Tax Override in Transactions

When you create or edit transactions, you can override the taxes for that transaction. Here’s how:

• Go to the purchase transaction’s creation or edit page.
• Go to the Total section below the Item Table.
• Click the Change option in the Total Tax Amount field.
• Modify the tax amount that has been calculated automatically and click Update.
• Click Save. Now the transaction will be saved with the modified tax rate.