QBO Automated Sales Tax (US Region)

Intuit have upgraded their Sales Tax calculations to a new auto Automated Sales Tax (AST), which will calculate the sales tax on an invoice.

Tax will be automatically calculated based on the following factors:

  • The state where you have nexus and are registered to collect sales tax
  • The physical address of your business
  • The physical address on the sales receipt or invoice
  • The product mapping you have associated with the products or services you are selling
  • The exemption status of your customer        

Click here to read more about how QBO calculates sales tax

What does this mean for you?

Not using AST?

Wise-Sync will batch invoices as normal. You don't need to do anything.

Using AST? Here's the low down.

QBO will disregard sales tax rates set by ConnectWise (and synced by Wise-Sync) and apply sales tax based on the AST method, described above.  This means, all control over sales tax now rests with QBO.

Considerations:

  1. The AST calculation will refer to the QBO Contacts state as set by the Shipping Address. 
  2. There is no longer an option to select the state for each invoice, as this will be defined by QBO directly.
  3. Where calculation differences are present between ConnectWise and QBO, this will result in an out of balance transaction, as the tax calculation is different between the two systems.
  4. AST cannot be fully supported by Wise-Sync due to an issue with zero tax invoices. Click here for more information, including what you need to do.

Configuration

When the Override Sales Tax Level in Wise-Sync Company Settings > Tax Codes is set to Warning, Wise-Sync will override the sales tax amount and allocate the tax to the agency defined on the Tax Group or Tax Level in ConnectWise to the QBO invoice (Tax Override).

When the Override Sales Tax Level in Wise-Sync Company Settings > Tax Codes is set to Halt, any invoice that is not in balance will not be successfully batched to QBO. The resulting tax calculations must be corrected in ConnectWise, ensuring that a valid tax amount results. The out of balance transaction in QBO will remain until the records is successfully resynced and matches between both systems.

QBO AST Shipping Address Handling

Sync Shipping From

Wise-Sync will take the address of the location/territory of the invoice and set this as the Shipping From address. If the ConnectWise Manage location/territory does not have an address configured, the QBO invoice Shipping From address will be populated with the primary address configured in your QBO Company.

Sync Shipping To

If the invoice in ConnectWise Manage contains an address to ship to, that address sync over as the Shipping To address in QBO. Otherwise, Shipping To in QBO will be blank.

S
Suzette is the author of this solution article.

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