QuickBooks Online: Get ready for an awesome new sales tax experience

If you are a QuickBooks Online User, Soon, you’ll see a sleek and beautiful new sales tax center that provides powerful insights into who you’re paying and how that fits into your overall tax liabilities. Plus, you’ll enjoy all the features you have now with an option that can calculate tax rates for you.

There’s nothing you need to do right now. But keep an eye out for another email in the coming weeks with instructions on how to verify your business address and confirm your tax agencies.

In the meantime, you can follow these steps………..

How to set up your new sales tax center

Find out how to set up your sales tax center in QuickBooks Online.

If you sell taxable products or services, QuickBooks can help you calculate and track your sales tax. Then, when it’s time to file your sales taxes, you’ll have everything you need to submit your payment.

Here’s how to get started:

Select Taxes, then select Get started.

Step 1: Double-check your business address

For the most accurate sales tax rates and reports, make sure you’re using the right business address. We use the physical address of your business to automatically calculate your sales tax rate.

If you need to change your business address:

Select Edit.
Update your address, then select Save.

Step 2: Match your tax rates and agencies to the official agencies

Tax agencies are the government agencies that collect sales tax in the states, cities, and counties where you do business. You’ll need to match the rates and agency names you previously set up with the official agencies. Make sure to ask your accountant if you don’t know which agency to use.

Here’s what each column means, and how to match your tax agencies to the official agencies.

TAX RATE NAME: This is the name of the tax rate you created. Even if it’s the same name as the official agency, you’ll still need to connect it before you can use a tax rate on a transaction.
RATE: This is the tax rate percentage you assigned to the agency.
YOUR AGENCY NAME: This was created when you assigned the tax rate under tax rate name.
OFFICIAL AGENCY NAME: These are the official agencies available in the tax center. You can assign sales tax rates for state, city, and county agencies.

To match tax rates with their official agencies:

From the Select an agency ▼ dropdown, match your tax rate name to the official agency name.
Select Next.
Review your tax rates. If everything’s right, select Next then View sales tax center.

What happens to existing data after updating your tax center?

If you’re looking for your past sales tax data, you can find it in the history section of your sales tax settings.

IMPORTANT DUE DATE REMINDER

The California Department of Tax and Fee Administration (CDTFA) is sending you an important due date reminder:

If you have a Sales and Use Tax or Use Tax quarterly prepayment to pay, your prepayment is due no later than the 24^th of the month.

If the due date falls on a weekend or state holiday, the due date is extended to the next business day.

If you have not done so already, please visit our website and Login to make your prepayment, prior to the due date shown above.

New Sales and Use Tax rates are operative as of January 1, 2020. For more information, please see the Special Notice on the CDTFA website.

If you have any questions, please call our Customer Service Center at 1–800–400–7115 (CRS:711). Customer service representatives are available Monday through Friday from 8:00 a.m. to 5:00 p.m. (Pacific time), except state holidays.

The CDTFA will be transitioning online users to create a username and password. If you have not already done so, visit the CDTFA’s online services page and Sign Up Now.

New Operative Date of April 25, 2019, for District Use Tax Collection Requirement Based on $500,000 Sales Threshold

The California Legislature recently passed Senate Bill (SB) 92 (Stats. 2019, ch. 34), which changes the operative date of the new district use tax collection requirement based on a $500,000 sales threshold from April 1, 2019 to April 25, 2019. As explained in our prior Special Notice L-632, under the new law, all retailers are required to collect and remit the district use tax on all sales made for delivery in any district that imposes a district tax if, during the preceding or current calendar year the total combined sales of tangible personal property in this state or for delivery in this state by the retailer and all persons related to the retailer exceed $500,000.

Assembly Bill (AB) 147 (Stats. 2019, ch. 5) established the new district use tax collection requirement with an operative date of April 1, 2019, and was signed into law on April 25, 2019. Changing the operative date to April 25, 2019, therefore, eliminates the retroactive effect of AB 147 with regard to the new district use tax collection requirement.

Please note that SB 92 does not change the operative date of the new state use tax collection requirement based on $500,000 in combined sales for delivery in California. The operative date of the new state use tax collection requirement is still April 1, 2019.

What are district taxes?

District taxes are voter-approved transactions (sales) and use taxes imposed by cities, counties, and other local jurisdictions. The current statewide California sales and use tax rate is 7.25 percent. In areas where a district tax is imposed (taxing district), the total tax rate includes the statewide rate plus the district tax rate(s).

Who is responsible for paying the district tax?

District sales taxes are due from retailers on their sales of tangible personal property and district use taxes are due from purchasers for their use of tangible personal property in a taxing district. However, a retailer that is “engaged in business” in a taxing district is generally required to collect the district’s use tax and pay it to the California Department of Tax and Fee Administration (CDTFA) on sales of tangible personal property delivered in the district. For more information on being engaged in business in a district, see publication 44, District Taxes (Sales and Use Taxes).

New operative date for new district use tax collection requirement

If you exceeded the $500,000 district use tax collection sales threshold in calendar year 2018 or during the period from January 1, 2019, through April 24, 2019, then starting on April 25, 2019, you were considered engaged in business in every district imposing a district tax and are required to collect, report, and pay the district use tax to the CDTFA on all sales made for delivery in those districts. You are not responsible for collecting, reporting, and paying the district use tax to the CDTFA on sales made for delivery in a taxing district prior to April 25, 2019, unless you were otherwise engaged in business in that district. However, if you have already collected district use tax from your customers on sales made prior to April 25, 2019, either at the time of the sale or at a later date, you must report and pay the collected tax amounts to the CDTFA on your sales and use tax return.

If you are otherwise engaged in business in a district, your responsibility to collect and pay the district use tax is not affected by the new collection requirement or the change in operative date, and you should continue to collect, report, and pay the district tax on all sales made for delivery into that district(s).

Tax rates in California

You may find the tax rates for each district on our website at www.cdtfa.ca.gov/taxes-and-fees/sales-use-tax-rates.htm. This webpage also includes a look-up tool, Find A Sales and Use Tax Rate by Address, located under the Current Tax Rates section

IMPORTANT DUE DATE REMINDER: Sales Taxes

The California Department of Tax and Fee Administration (CDTFA) is sending you an important due date reminder:

If you have a Sales and Use Tax or Use Tax quarterly prepayment to pay, your prepayment is due no later than the 24^th of the month.

If the due date falls on a weekend or state holiday, the due date is extended to the next business day.

If you have not done so already, please visit the website and Login to make your prepayment, prior to the due date shown above.

New Sales and Use Tax rates are operative as of July 1, 2019. For more information, please see the Special Notice on the CDTFA website.

We have also made enhancements to our sales and use tax return. For more information, please see our new tutorial videos How to File Schedule A and How to File Schedule A Using the Upload Feature.

If you have any questions, please call our Customer Service Center at 1–800–400–7115 (TTY:711). Customer service representatives are available Monday through Friday from 8:00 a.m. to 5:00 p.m. (Pacific time), except state holidays.

To set up a username and password, visit CDTFA’s Online Services page at Sign Up Now.