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April 6, 2022
Question

How do I set up my sales tax exempt sales for First Nations tax exempt customers?

  • April 6, 2022
  • 1 reply
  • 0 views
Selling products as well as Electrical services on a First Nation. They are requesting that i do not charge them sales tax. How do I set that up in Quickbooks Online?

1 reply

Jen_D
April 6, 2022

Glad to have you here, @shinethelight306.

 

I'll show you the steps to create non-taxable sales for a First Nation customer in QuickBooks Online.

 

For this, you have several options to choose from. You can select the Out of Scope tax code, so QuickBooks will not calculate sales tax for this client. The entry will have no impact on your tax liability or returns and won't hit the tax centre in QBO. The amounts will be completely separated from the tax tracking feature. 

 

You can also choose the other two zero-amount tax codes which are Zero-rated and Exempt. Remember, those two codes should be used based on the guidelines on the CRA website.

 

To learn more about the tax codes available in QuickBooks, check out this link: Common sales tax codes.

 

After you add the client, create the sale like you normally do. Here's how:

 

  1. Click the + New icon.
  2. Choose Invoice or Sales receipt.
  3. Pick a tax code from Amounts are box.
  4. On the line items, use Out of Scope, Zero -rated or Exempt.
  5. The tax amount box, should show 0.00.

 

Post here anytime if you have customer and sales tax concerns. I'll be glad to help you out. Have a nice week ahead!