Canada: Set default sales tax rate with QuickBooks Online

TaxDome helps Canadian firms automatically apply sales tax rates from QuickBooks Online to invoices, recurring invoices, and proposals. You can sync tax rates from your QuickBooks Online account and set a default rate that pre-fills when creating new billing documents.

Before you start

To use this feature, ensure the following:

• You are a firm owner or an employee with Manage integrations access rights.
• Your firm is registered as a Canadian firm in TaxDome.
• QuickBooks Online integration is set up in your TaxDome account.

Step 1. Enable sales tax sync

Before you can set a default sales tax rate, you need to enable sales tax sync with QuickBooks Online. This way, TaxDome will be able to retrieve all sales tax rates from your QuickBooks Online account.

1. Go to Settings > Integrations > QuickBooks from the left menu bar.

2. In the Sync settings section, toggle on Use QuickBooks sales tax rates (Canada).

3. Click Save.

Once enabled:

• TaxDome retrieves all sales tax rates from your QuickBooks Online account.
• The Sales tax field appears in invoices, recurring invoices, proposals and templates.
• Manual tax rate entry is no longer available—you must select from QuickBooks sales tax rates.
• The default sales tax rate is set to Out of scope (0%).

Note

Invoices created before enabling this feature will continue to use manual tax rates. When these invoices sync to QuickBooks Online, they will sync without sales tax information.

Step 2. Set default sales tax

When sales tax sync is enabled, you can set a default sales tax rate that will automatically pre-fill the Sales tax field when creating new invoices, recurring invoices, proposals and templates.

To set the default sales tax:

1. Go to Settings > Billing > Invoices from the left menu bar.

2. Locate the Default sales tax field.

3. Select a sales tax rate from the dropdown. The list displays all sales tax rates available in your QuickBooks Online account.

4. Click Save to apply your changes.

Tip

If you don’t see the sales tax rates you need in the dropdown, you’ll need to set them up in QuickBooks Online first. For more details, refer to QuickBooks Online knowledgebase .

The selected sales tax will automatically pre-fill the Sales tax field when creating:

• One-time invoices
• Recurring invoices
• Proposals
• Invoice templates
• Recurring invoice templates
• Proposal templates

Step 3. Change sales tax as needed

You can change the sales tax rate manually when creating/editing invoices, recurring invoices, proposals, and templates.

To change the sales tax rate:

1. Open the invoice, recurring invoice, proposal or template you want to edit.

2. Locate the Sales tax field in the line items section.

3. Click the dropdown and select a different sales tax rate.

4. The tax amount and total will automatically recalculate based on your selection.

5. Click Save or Create to apply your changes.

Note

The list of sales tax rates updates automatically when you add new rates in QuickBooks.

Handle inactive sales tax rates

If a sales tax rate becomes inactive in QuickBooks Online after you’ve set it as your default, the rate will display with an (INACTIVE) label in the Default sales tax field.

When this happens:

1. Go to Settings > Billing > Invoices.

2. Update the Default sales tax field to an active rate.

3. Click Save.

New invoices, recurring invoices, proposals and templates will now use the updated default rate. If you have unpaid invoices that use the inactive rate, you can update them manually .

Note

If you disable sales tax sync or your QuickBooks Online integration becomes disconnected , the system will revert to manual tax rate entry. Existing invoices will keep their QuickBooks sales tax rates, but you won’t be able to select QuickBooks rates for new invoices.

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