Basic Sales Tax Setup for QuickBooks (Desktop)

Transcription

1 Basic Sales Tax Setup for QuickBooks (Desktop) Who should use this guide: Accountant Anyone in the office responsible for QuickBooks setup or exporting to QuickBooks What you will learn in this guide: How sales tax in ServiceTitan integrates with QuickBooks How to set up default business unit sales taxes and tax zones in ServiceTitan How to set up Basic Sales Tax tracking in QuickBooks How to export sales tax from ServiceTitan to QuickBooks How to troubleshoot common errors you may encounter ServiceTitan Best Practices Tracking sales tax is a necessity for any business. ServiceTitan has several options for tracking sales tax. The Basic Sales Tax tracking setup is a good fit for your company if: Your company does not need to track and manage multiple sales tax rates. Your company does not plan to file and pay taxes directly from QuickBooks. Your company is new to QuickBooks or you are a first-time QuickBooks user. If this does not fit your business needs, you can explore other sales tax tracking options here. Track your sales tax liabilities quickly and accurately The Basic Sales Tax tracking option is already configured in ServiceTitan. As soon as you complete the required QuickBooks setup and set your sales taxes in ServiceTitan, you will be able to start tracking sales tax. You will be able to check your sales tax liabilities easily by running a QuickReport in QuickBooks. ServiceTitan KnowledgeBase page 1 of 13

2 Overview Sales tax will be calculated in ServiceTitan and not in QuickBooks Sales tax will be calculated in ServiceTitan based on the tax rates you have set up. It will populate on the ServiceTitan invoice in the tax field. You will set up a Sales Tax Payable item in the QuickBooks Item List This setup only needs to be completed once. It ensures that sales tax exports correctly from ServiceTitan and is mapped to the correct account in QuickBooks. This item will be used in QuickBooks to represent your sales tax. ServiceTitan KnowledgeBase page 2 of 13

3 Sales tax will be exported as a line item to QuickBooks After the invoice is batched, posted, and exported from ServiceTitan, the sales tax will show as a line item on the QuickBooks invoice. You can run a QuickReport in QuickBooks to determine your sales tax liability You can run a QuickReport for the line item you previously created to represent sales tax. This will allow you to see your sales tax liabilities for a specified period of time. ServiceTitan KnowledgeBase page 3 of 13

4 Instructions / How To s Basic Sales Tax Overview 5 Description of this setup 5 Basic Troubleshooting & Important Things to Note 5 Required ServiceTitan setup 6 Sales tax setup 6 Taxable equipment and services setup 6 Required QuickBooks setup for Basic Sales Tax 8 Creating a QuickBooks item for Sales Tax Payable 8 Exporting sales tax from ServiceTitan to QuickBooks (Basic Sales Tax setup) 10 FAQ 12 ServiceTitan KnowledgeBase page 4 of 13

5 Basic Sales Tax Overview Description of this setup Sales tax will be calculated in ServiceTitan and exported as a Service Type line item to QuickBooks. An item will need to be created in QuickBooks to represent your sales tax, and the sales tax will show as a line item on invoices in QuickBooks. This ensures the invoice in ServiceTitan matches the invoice in QuickBooks. Basic Troubleshooting & Important Things to Note If sales tax was not exported to QuickBooks, check that sales tax was calculated in ServiceTitan. If you receive a TAX0001 error, you will need to create a TAX0001 item in the Item List. Refer to the FAQ for further instructions. You will not be able to use the Sales Tax Liability Report in QuickBooks, as sales tax will be represented as a line item on the invoice. To determine your sales tax liability, go to Lists > Item List > Sales Tax Payable > QuickReport. Sales tax activity will populate in the QuickReport based on the invoice date set in ServiceTitan. ServiceTitan KnowledgeBase page 5 of 13

6 Required ServiceTitan setup Sales tax setup Before exporting to QuickBooks, you will need to set up your sales taxes in ServiceTitan. This can be done two ways: 1. Setting a default sales tax rate for each business unit. Go to Settings > Business Units > Default Tax Rate to set these rates. 2. Setting tax zones. Go to Settings >Tax Zones to configure tax zones. You will need to: Make sure each zone has the correct zip codes assigned. Ensure your customers addresses are Google verified. Once you have set the tax zones, you must click Set Tax Zones to apply the settings to your customers. You can manually add a tax zone to a customer by going to Search > Customer Name > Location > Edit Pencil > Tax Zone. Taxable equipment and services setup For sales taxes to calculate properly, you will also need to configure your taxable equipments and services in ServiceTitan. To do this: 1. Go to Settings > Pricebook > Services or Settings > Pricebook > Equipment. 2. Click into the service or equipment. 3. If you want to set the service/equipment as taxable, check the box beside the taxable field. If you need to change multiple items, you can export the Pricebook. To do this: 1. Go to Settings > Import / Export Data > Export > Pricebook > Export > Download. ServiceTitan KnowledgeBase page 6 of 13

7 2. In the appropriate Excel tab, navigate to the Taxable column. 3. Enter 1 in the Taxable column if the item is taxable. Enter 0 in the column if the item is nontaxable. 4. Save your work, and import the Pricebook back into ServiceTitan. ServiceTitan KnowledgeBase page 7 of 13

8 Required QuickBooks setup for Basic Sales Tax Creating a QuickBooks item for Sales Tax Payable A Sales Tax Payable item must be set up in the Item List in QuickBooks before exporting from ServiceTitan. This only needs to be completed once. The created item will be used in QuickBooks to represent your sales tax. 1. Open the List menu and select Item List. 2. At the bottom of the window, open the Item menu and select New (or use the shortcut CTRL+N). ServiceTitan KnowledgeBase page 8 of 13

9 3. Enter the following information into the New Item window. Item Type: Service This should be the default item type. Item Name: Sales Tax Payable Account: OtherCurrentLiability 4. Click OK. The Sales Tax Payable account should now show in your item list. ServiceTitan KnowledgeBase page 9 of 13

10 Exporting sales tax from ServiceTitan to QuickBooks (Basic Sales Tax setup) 1. Ensure you have set up your sales taxes in ServiceTitan, and ensure the required Sales Tax Payable item in the Item List has been created in QuickBooks. 2. Confirm that sales tax has been calculated on the ServiceTitan invoice. Sales tax is shown in the tax field on each invoice. 3. Batch and post the invoice in ServiceTitan. 4. In QuickBooks, go to File > Update Web Services and run the web connectors for the appropriate business units. 5. In ServiceTitan, go to Reports > Pending Export Report. Run the report to ensure your invoice has been successfully exported to QuickBooks. 6. After successfully exporting from ServiceTitan, check the QuickBooks invoice to confirm that sales tax populated on the invoice. It should show as a line item. ServiceTitan KnowledgeBase page 10 of 13

11 7. Run a QuickReport to see the activity for sales tax. To run the QuickReport: Go to Lists > Item List. In the Look for search bar enter Sales Tax Payable. At the bottom of the window, select Reports > QuickReport: Sales Tax Payable. Note: If you are using a TAX0001 item instead of a Sales Tax Payable item, you will need to complete these steps using TAX0001 instead of Sales Tax Payable. ServiceTitan KnowledgeBase page 11 of 13

12 FAQ Why is sales tax not populating on my ServiceTitan invoice? Sales tax may not populate on your ServiceTitan invoice if: A default sales tax rate has not been assigned to the business unit. Go to Settings > Business Units > Default Tax Rate to assign a tax rate to a business unit. Tax zones are not set up correctly. To ensure tax zones are set up correctly: Make sure each zone has the correct zip codes assigned. Ensure your customers addresses are Google verified. Once you have set the tax zones, you must click Set Tax Zones to apply the settings to your customers. You can manually add a tax zone to a customer by going to Search > Customer Name > Location > Edit Pencil > Tax Zone. Note: You can find tax zone settings in Settings > Tax Zones. The service or equipment is not set as taxable. Your service/equipment must be set as taxable for sales tax to be applied. Go to Settings > Pricebook > Services or Settings > Pricebook > Equipment, and click into the service or equipment. Ensure the box beside the taxable field is checked. How can I see if my invoices are exporting successfully to QuickBooks? To check if your invoices are exporting successfully, check the Pending Export Report in ServiceTitan. To access this report, go to Reports > Accounting > Pending Export Report. Select the Lookup icon (magnifying glass) to run the report. What should I do if I am receiving Error: There is an invalid reference to QuickBooks Item Sales Tax Payable on the Pending Export Report? If you are receiving this error, you will need to create a Sales Tax Payable item in the Item List. ServiceTitan KnowledgeBase page 12 of 13

13 What should I do if I am receiving Error: There is an invalid reference to QuickBooks Item TAX0001 on the Pending Export Report? This error may occur if you turned sales tax on in QuickBooks and then off, or vice versa. If you are receiving this error, you will need to create a TAX0001 item in the QuickBooks Item List. You may receive this error even if you have already created the Sales Tax Payable item. Follow the same procedure used to set up the Sales Tax Payable item, but the Item Name must be TAX0001. Sales tax will now show on your QuickBooks invoices as TAX0001. When you run the QuickReport for sales tax liability, you will need to run it for TAX0001 and not Sales Tax Payable. What should I do if I am receiving another error on the Pending Export Report? If you are receiving another type of error, ensure your services and equipments are mapped to the appropriate account or class in QuickBooks. Why is the sales tax on my ServiceTitan invoice different from the sales tax on my QuickBooks invoice? If the sales tax on your ServiceTitan invoice is different from the sales tax on your QuickBooks invoice, ensure that sales tax is not being charged in QuickBooks. Go to Edit > Preferences > Sales Tax > Company Preferences and make sure No is selected for Do you charge sales tax? How do I see my sales tax liability? To see your sales tax liability, you can run a QuickReport for the Sales Tax Payable item you have created. To run the QuickReport: 8. Go to Lists > Item List. 9. In the Look for search bar enter Sales Tax Payable. 10.At the bottom of the window, select Reports > QuickReport: Sales Tax Payable. If you are using a TAX0001 item instead of a Sales Tax Payable item, you will need to complete these steps using TAX0001 instead of Sales Tax Payable. ServiceTitan KnowledgeBase page 13 of 13