Setting Sales Tax Preferences

Before you can apply sales tax on your sales to customers, you need to set up preferences that indicate your sales tax requirements. In the Preferences window, you indicate when tax is charged to your customers, the frequency with which you pay sales tax to the government, and the name of the taxing jurisdiction to whom you pay tax. You can also indicate whether you want taxable items to be tagged on invoices.

Select Edit, Preferences to open the Preferences window.

Click the Sales Tax icon.

Click the Company Preferences tab.

Select Yes to indicate that your company charges sales tax.

Indicate the terms you want to use to refer to taxable and non-taxable sales.

Indicate the name of the sales tax item you most frequently charge to customers.

Check this box if you want a T to appear on sales forms to identify taxable items.

Indicate when you actually owe sales tax.

Select the frequency of your sales tax remittances.

Click OK to save your changes.

Did You Know?

Tax can be owed at the time of sale or at the time of payment. If your company's financial records are kept on the accrual basis, tax is owed to your government taxing agency at the time of sale and you remit the tax to the government when you file your sales tax return, whether or not the customer has paid the bill. If your records are kept on the cash basis, the sales tax is not owed by the customer, nor do you owe it to the government, until you collect the money from the customer.