How to Adjust Sales Tax Payable in QuickBooks?

Sales tax collected is the aggregate amount of tax which is collected from customers during the sales on the behalf of the government. It is very important to follow the sales tax regulations of the local and out of state tax agencies for all types of business. The owner of the business requires to track the taxable and non taxable sales separately.

QuickBooks offers a useful feature to its users which they can adjust their sales tax according to the tax authorities. In this article we will teach you how to adjust sales tax payable in QuickBooks. So  you can report your sale tax summary without any issues

Sales Tax Adjustment in QuickBooks

If you are using automated sales tax in QuickBooks then it is easy to add or delete the sales tax adjustments in QuickBooks. You can easily adjust the sales tax whenever you receive a tax credit, discount or fine with the help of automated sales tax.

Add Sales Tax Adjustment

Step 1: Create an account for sales tax Adjustment

  • Fix an expense account where you need to increase the due sales tax, on the other side create an income account when you need to decrease the sales tax. It is useful to create an appropriate account.
  • Go to the gear icon at the top right corner.
  • And now income or expense from the account drop down menu.

Income Account: Choose this, if you want to decrease the sales tax.

Expense Account: Choose this, if you want to increase the sales tax.

  • Then click on details.

If you want to use the income account then, click on the sales of product income

If you want to use the expense account then, click on the taxes paid option

  • Name your account such as sales tax adjustments
  • after reviewing, select save and close

Step 2: Add an Adjustments

Go to taxes and then click on the sales tax tab from the navigation bar.

  • Then, select the tax period which you want to adjust and then click on view return.
  • Select add an adjustment and the reason for adjustment.

After that, choose the account if you want to make the adjustment. After submitting the adjustment and select the add option.

Delete Sales Tax Adjustment

QuickBook offers you a various option to delete the sales tax adjustment if the adjusted tax is wrong or mistakenly added

  • Go to the gear icon at the top right and then click on the chart of account option
  • Here find the expense or income account in which you want to delete sale tax adjustment
  • Next select the run report and then click on the adjustment you want to delete
  • Then click on the delete and confirm the same

Adjust Sales Tax in QuickBooks Desktop

In QuickBook Desktop when you make change to sales tax you transfer money from and to the Sales Tax Liability account. Therefore it is necessary for you to know when and how to adjust sales tax payable in QuickBook Desktop

Here are the reasons due to which you should adjust the sales tax

  • When the Sales Tax agency has offered you any type of discount
  • When a fine is charged on you by the Tax authority due to late or non payment of sales tax
  • If you want to make correction in previous tax period
  • When quickbooks and sales tax forms don’t match

Adjusting the Sales Tax in QuickBooks Desktop

  • Choose the vendor option and then choose the Sales Tax
  • Next  you can click on the Adjust Sales Tax Due . A new Sales Tax Adjustment window will open
  • In this window enter the adjustment date class sales tax ventor and adjustment account
  • then select if you want to increase or decrease sales tax and enter the amount
  • In memo you could write sales tax adjustment for reference
  • finally after reviewing the information click ok

We hope that you have understood how to adjust sales tax payable in QuickBooks or Quickbooks Desktop. It helps you in managing and reporting the sales tax to the official authority in the best way.

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