Do you collect sales tax? This document will help you get set up. You must perform this configuration before you can create your POS stations.

QuickBooks Online made a huge change on November 11, 2017!

QuickBooks Online dramatically changed how they handle sales tax on November 11, 2017, and we built Evosus Pro to use this new functionality. Unfortunately, that means Evosus Pro does not work with QuickBooks Online accounts that were created prior to November 11, 2017. We actually perform a validation when you integrate your QuickBooks Online account with Evosus Pro to verify that you're using a compatible version. 

What if you're using an pre-November 11, 2017 version of QuickBooks Online?

Your version of QuickBooks Online is not compatible with Evosus Pro. You can either work with Intuit to upgrade your QuickBooks Online account, or you can import your data into a new QuickBooks Online account.

What do you need to know about taxes (just the basics)....

  • All customers are taxable in Evosus Pro - There is a defect in QuickBooks Online. You can set up customers as taxable/non-taxable in QuickBooks Online, but the tax status of a customer is not correctly sent to Evosus Pro. That means all customers are treated as taxable in Evosus Pro. This will be corrected in a future version of QuickBooks Online.  
  • Use QuickBooks Online to set up inventory items as taxable/non-taxable - When an inventory item is set up as taxable/non-taxable in QuickBooks Online, the inventory record in Evosus Pro is correctly updated. Non-taxable items will not be charged sales tax in point of sale in Evosus Pro.
  • Set up one taxable authority in QuickBooks Online - For example, if your retail store is in Seattle, Washington, set up the state of Washington as a tax authority in QuickBooks Online. When Evosus Pro sends sales tax amounts to QuickBooks Online, QuickBooks Online will automatically distribute the sales tax amount into a state, county, and local tax amount.
  • Set up your tax rate in Evosus Pro - Set up your tax rate in Evosus Pro. The tax rate must be the aggregate tax rate (state, county, and local). 
  • What if a customer is exempt? Currently, it's difficult to make a customer tax exempt. We will improve this in future releases, but the current process is covered later in this document.
  • What if a customer has a shipping address in a different state or tax authority? - If the shipping address on a customer is in a different state or tax authority, sales tax will be collected at the rate set up in Evosus Pro, but QuickBooks Online will distribute the sale tax payable amount to a GL account called Out Of Scope Agency Payable


Step 1: Set up sales taxes in QuickBooks Online (you probably already did this step)

Setting up sales tax is the first thing you should do when creating a QuickBooks Online account. You must perform this step before doing any of the following...

  • Importing your inventory items into QuickBooks Online
  • Importing your customers into QuickBooks Online
  • Integrating your QuickBooks Online with Evosus Pro

That means if you're Evosus Pro and QuickBooks Online are already integrated, you've already performed this step.

  1. Log into QuickBooks Online. 
  2. Open the Taxes tab.
  3. Follow the steps to set up sales tax. This process will create a tax authority, and QuickBooks Online will automatically create a GL account where the sales tax payable will be kept.
    • What if you're in a state that doesn't collect sales taxes, and you don't want to collect sales tax on any sale? - Unfortunately, right now you still have to set up a tax authority in QuickBooks Online in order to activate the sales tax feature. For example, if you have a single store in Oregon, you still have to set up a tax authority in a sales tax state in order to integrate your QuickBooks Online and Evosus Pro. But this authority will never accrue taxes as long as your inventory items are all set up as non-taxable. 

When you're done, your Tax tab should look something like the image below. You have a tax authority, and it is currently accruing sales tax. 



Step 2: Verify that your inventory items are set up as taxable/non-taxable

In QuickBooks Online, you can set up inventory items as taxable and non-taxable. For example, if you provide a service that isn't taxable in your state, you can set up that service as an inventory item that is non-taxable. When a sales receipt is created for the service, no sales tax will be calculated on that inventory item.

  1. Log into QuickBooks Online.
  2. Click and select Products and Services. The Product and Services screen appears, listing all of your inventory items.
  3. Verify that there is a check in the Taxable column next to each taxable inventory item.
    • Change an item to taxable/non-taxable - Click Edit next to the inventory item, and then change the selection in the Is Taxable box on the screen that appears.  

For example, there is a taxable and a non-taxable item in the image below.

Step 3: All customers in QuickBooks Online are set up as taxable

There is a bug in QuickBooks Online that keeps applications like Evosus Pro from determining if a customer is set up as taxable or non-taxable in QuickBooks Online. That means all customers are taxable in Evosus Pro, even if the customer is set up as non-taxable in QuickBooks Online.

For example, if you set up a customer as non-taxable in QuickBooks Online, the customer will still be charged a sales tax in Evosus Pro. The customer in the image below will still be charged sales tax in Evosus Pro even though they are set up as a non-taxable resaler in QuickBooks Online.

Step 4: Verify the Default Customer address is the same as your retail store

You need to associate a customer record with your POS station. By default, this is the customer that will be used on a sales receipt. The shipping and billing address on the default customer should be the same address as your retail store. That ensures that when you use the default customer, sales tax accrues correctly in the sales tax authority that you created in QuickBooks Online.


Step 5: Create a tax code in Evosus Pro

You'll need to create a tax code in Evosus Pro to collect sales tax on your sales receipts created in Evosus Pro. This tax code will be used to calculate the entire sale tax payable on a sales receipt generated in Evosus Pro.

For example, if you have a single retail location in Vancouver, Washington, then you might create a single tax code in Evosus Pro with a tax rate of 8.4% (6.5% Washington, 1.2% Clark County, and .7% local). When you record a sale in Evosus Pro, the entire sales tax payable will be sent to QuickBooks Online, and QuickBooks Online will then break the total sales tax payable amount into the application state, county, and local amounts. 

  1. Log into EvosusPro.com.
  2. Click .
  3. Select Add Tax Code.
  4. Complete the fields.
    • Name - This is how you will identify the tax code. For example, EXEMPT, WASHINGTON, etc.
    • Agency Name - Name of the sales tax authority.
    • Tax Rate - You cannot apply multiple tax codes to a single transaction. For example, you cannot create a separate tax code for state, county, and local sales tax, and then apply all three to every transaction. If multiple tax rates apply, you need to combine them together into a single tax rate and enter it into this field. The sales tax amount will be automatically broken into its component parts (state, county, local) in QuickBooks Online.
  5. Click Save.

Step 6: What if a customer is non-taxable?

Currently, the best way to handle this is create an EXEMPT sales tax rate in Evosus Pro, and an EXEMPT customer in QuickBooks Online. To process a non-taxable receipt, assign the EXEMPT sales tax rate to the POS station, log into POS using that POS Station, and then process the transaction using the EXEMPT customer record.

  • Create an EXEMPT customer in QuickBooks Online - When you process a non-taxable sales receipt, select the EXEMPT customer. If you have a customer that is always tax exempt, you can also set up that customer up as tax exempt in QuickBooks Online. 
  • Create an EXEMPT sales tax in Evosus Pro - When you process a non-taxable sales receipt, use the POS Stations screen to change the tax code on the POS station to the 0% tax rate, and then process the transaction.
  • This process will be improved in future releases!

Step 7: Test your tax code

  1. Log into EvosusPro.com.
  2. Open the Tax Codes screen ( > Tax Codes).
  3. Click Test Tax Codes.
  4. Select a tax code.
  5. Verify that the taxable amount is correct.

Step 8: Add the tax code to a POS station

Now that you've verified that the tax code is calculating tax correctly, you can assign it to a POS station.

Now that you're set up, what happens when you create a sales receipt?

  • Tax rate - Tax rate on the POS station is used to calculate the sales tax payable on each sales receipt. For example, if the tax rate is 8% and the sales receipt is $100, Evosus Pro will calculate a sales tax payable of $8. This amount will be sent to QuickBooks Online.  
  • What if the tax rate is incorrect? - If you set up the wrong tax rate in Evosus Pro, QuickBooks Online will not recalculate the tax on the sales receipt. QuickBooks Online will distribute the sales tax payable that was collected to the tax authority set up in QuickBooks Online.    
  • How does QuickBooks Online record the sales tax payable?
    • Customer has in-state address - The sales tax payable amount calculated by Evosus Pro will be divided into a state, county, and local amount in the tax authority set up in QuickBooks Online. You can see this report using the Taxes tab in QuickBooks Online.
    • Customer has an out of state address - If the customer has an out of state shipping address, QuickBooks Online will try to accrue the sales tax payable amount in the tax authority for that state. If that tax authority has not been set up in QuickBooks Online, it will accrue in a GL account titled Out Of Scope Agency Payable