Sales Tax Models
Automatic vs classic sales and use taxes
In 2017, QuickBooks Online implemented automated sales and use tax (AST), which calculates taxes based on the shipping address and the location of the company rather than assigning sales tax codes manually. The "classic" model required the user to specify a tax code in order to calculate the tax amount.
LedgerLink now relies on the automated sales and use tax feature. When a sales transaction is sent to QuickBooks Online, it will be immediately requested so the tax info in LedgerLink will be correct.
Hybrid Sales Tax
In May 2020, QBO announced a Hybrid Sales Tax model, which allows users to use AST, but still use customized "classic" tax codes. That is, you can direct QBO to calculate taxes based on user-defined tax codes. LedgerLink intends to support the use of the Hybrid Sales Tax model as soon as QBO resolves the issues with the API. See this document for more details.
International versions of QuickBooks Online do not use the automated sales and use tax feature.
- tax codes are specified by line item
- line item amounts can be inclusive or exclusive of tax
- each sales transaction can have many tax codes
In order to properly support the sales and use tax features, there are dedicated layouts for each sales transaction for United States users and international users.