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Handling U.S. Sales Tax for Back-end Orders / Handling Taxable Back-end Orders

Last updated 08/01/2021

How to handle U.S. taxes on back-end sales orders with QuickBooks Online.

Overview


U.S. sales tax can be complicated, especially when you have to handle multiple states and counties across multiple sales channels. To make things easy, Cin7 has a special feature that allows you to preserve the fidelity of tax calculated on orders imported from integrated channels.

In order for this to work, you must meet the following prerequisites:

  • Your business must be based in the United States.
  • Your QuickBooks Online account is integrated with Cin7.
  • You've enabled the Automated Sales Tax feature in QuickBooks Online software. 
  • Taxes are set up correctly in your QuickBooks Online software.

It is also likely that you will use a separate tax filing/reporting automation software to ultimately figure out what you owe and to whom.

Enable the U.S. Sales Tax Function


 To do this:

  1. Log into Cin7 as an Administrator.
  2. While logged in as an Administrator, from the left navigation, select Accounting then QuickBooks Online.
  3. From right, select the gear icon.
  4. Select Settings.
  5. In the Settings tab, select the checkbox next to Get Tax Rates For Backend Sales & Quotes (US Only).
  6. Save Save.

Using U.S. Sales Tax


When the delivery ZipCode field and the State field are populated on a sales order, Cin7 will retrieve the tax rate from QuickBooks Online. The appropriate tax will appear in the Alternative Tax Rate field in the Sales Order. The tax amount will be considered when calculating the total of the order.

Upon importing the order to QuickBooks Online, the tax will be split and posted to the default tax agency liability accounts.

Modifying Tax Rates

Note that if you modify a tax rate in the Alternative Tax Rate field at any stage and save the transaction, you will not be able to recreate the unique tax rate.  Please modify this field with care!

FAQ


How do I handle Exempt Orders?

Sales tax exemption certificates enable a purchaser to make tax-free purchases that would normally be subject to sales tax. Within the Cin7 CRM module, applying the "Exempt" as the customer "Tax Status" will ensure no tax is applied to the sale.