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Does Quickbooks Online count sales tax as income on the profit and loss report or does it only count the actual sales?
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Does sales tax on an invoice only go to the liability account on the Balance Sheet or is it also included in Accounts Receivable and somewhere on the P&L? If I'm making an adjustment to a sales tax payment because what the state said that I owe is more than what QBO says, what account should I book the adjustment to?
Sales tax on an invoice is included in both A/R and your sales tax payable liability balance until the invoice is paid. When the invoice is paid, the A/R portion is closed out because you received payment but the sales tax liability portion stays on your balance sheet until your tax agency is paid. Nowhere is it reported on your P&L. But, if you need to increase the sales tax payable liability balance, book it to a sales tax adjustment expense account (set one up if you don't have one). The adjustment will go on your P&L and can be closed out at year-end to keep your books clean.
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