Managing sales tax requires a little bit of effort, but not too much. Here's how to deal with sales tax in our app.

How do I categorize sales tax?

When you receive income that includes sales tax, mark the entire transaction as Business Income don't separate out the sales tax amount. Then, when you make the sales tax payments to your government, mark that expense as Business and categorize it as Taxes & Licenses: Sales Tax.

If you're an online seller or take payments electronically, the service you use may automatically keep track of your sales tax totals, making it easy for you to submit the payments to your state, county, or city. If not, you may need to keep track of these manually or use a separate tool to help you do this.

Can I apply sales tax in an invoice?

You can make a separate line item for it, but we don't calculate it for you. If you need to manage sales tax in invoices, we recommend QuickBooks Online.

I'm an Etsy seller. How do I handle sales tax?

On Etsy, you'll see your sales tax collected, but it won't show up in a separate transaction in our product. Use the sales tax totals you find on Etsy to make your sales tax payments. Then, when your bank processes the payments, come back to our app and follow the categorization steps above.