The Sales Tax Liability report gives you an overview of your sales and the taxes you’ve collected. Under the “Total Tax Amount” column, the total tax collected from your customers will appear, which includes both state and local tax rates.
This report shows how much tax you charge for each sale and includes additional details such as customer names, transaction dates, and the tax rate applied. Sometimes, users may face a problem where their sales tax liability report doesn’t match with other reports. In this guide, we will discuss how to access sales tax liability in QuickBooks and provide solutions to fix the mismatch with total income.
Accessing Sales Tax Liability Report in QuickBooks
If you want to learn how to generate a Sales Tax Liability Report in QuickBooks, here are the steps.
- Open QuickBooks.
- Navigate to the “Reports” menu.
- Open “Sales Tax” from the drop-down menu.
- Tap on “Sales Tax Liability.”
- Generate the report.
Note: Incomplete/missing data can make QuickBooks sales tax liability report incorrect, therefore you must verify your financial data.
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Create a Non-Taxable Sales Report in QBO
To create a report in QuickBooks Online that shows all customers with non-taxable sales, follow these steps:
- Go to Reports.
- Use the search field to find and select Taxable Sales Detail.
- Click Customize.
- Open the General dropdown.
- Choose the desired date range.
- In the Filter dropdown, select these options:
- Customer Taxable: Check this to include all customers with non-taxable sales.
- Distribution Account: Choose All Income/Expense Accounts. It will exclude the A/R Source line from the report.
- Product/Service Taxable: Select Non-Taxable to filter the report to show only non-taxable sales.
- Click Run report.
Fixing the Sales Tax Liability and Total Income Reports Issue
To find discrepancies, compare the details from both reports as follows:
- Sales Tax Liability Report:
- Go to the Reports menu.
- Select Vendors & Payables and then Sales Tax Liability.
- Double-click the Total in the Total Sales column.
- Open the Sales Tax Revenue QuickZoom report.
- Click Customize Report.
- Choose the report basis (Accrual or Cash).
- Set the date range to match the Profit and Loss report.
- Go to the Filters tab.
- Select Accounts.
- Choose All ordinary income accounts.
- For Transaction Type, select Multiple Transaction Types and check all except Invoice and Sale Receipt.
- Click OK twice.
- Profit and Loss Standard Report:
- Go to the Reports menu.
- Select Company & Financial and then Profit & Loss Standard.
- Double-click on Total Income.
- Click Customize Report.
- Choose the report basis (Accrual or Cash).
- Set the date range.
- Match the Sales Tax Liability report.
- Go to the Filters tab.
- Select Accounts.
- Choose All ordinary income accounts.
- For Transaction Type, select Multiple Transaction Types and check all except Invoice and Sale Receipt.
- Click OK twice.
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Conclusion
By following these steps, you can effectively compare and resolve discrepancies between the Total Income Report and Sales Tax Liability in QuickBooks.
