I have a bill with ON PST, ON PRE and HST. What is the correct way to record those taxes properly on the bill?

Hello emb2,

I can see how having multiple sales tax rates on a bill can make posting the transaction a bit confusing. QuickBooks Online allows you to create custom and group tax rates to handle situations such as this. I'd be happy to explain this for you. 

QuickBooks Online gives you the opportunity to work with sales tax codes individually or you can create a group rate. If you've already set up regular sales taxes for Ontario, the 13% HST rate will already be in your system. It'll be located under the Canada Revenue Agency. You'll then add the PST and PRE tax rates as Custom Tax Rates. Here's how to add a custom tax rate in QuickBooks Online: 

• From the left menu, select Taxes.
• Select Sales Tax at the top (If you use payroll in QuickBooks Online, you may need to select Sales Tax as opposed to Payroll Tax.)
• Select Manage sales tax.
• Locate the sales tax agency you wish to add the new rate for, and select Add custom rate.

Within here, you'll set up the PST and PRE taxes with whatever rate they should be. When you go to enter the Bill, you can then assign one of the codes to each line as needed. If you'd like to have all three rates applied to all items on the bill, you can then create a Group rate, allowing you to combine the HST, PST, and PRE into a group tax code. This allows you to use these three tax codes all at once on a particular bill or invoice. The steps to set up this group tax rate are:

• Repeat the first three steps above, going into the Manage sales tax screen.
• Click the Add tax button towards the top right of the page. 
• Click Add within the third option combine taxes into a group rate.
• Enter a name for the group rate, then you can add up to 5 individual tax rates into the group. You'll indicate for each whether the tax is applied to the Net amount, Tax amount, or Net + Tax amount. 
• Once you've added and reviewed the group rate settings, select Add to the bottom right to save the group rate. 

More information about adding tax rates can be found in our Community article How to set up a new sales tax code. One thing to note is that once the group rate is created, it cannot be edited. If a change needs to be made, you'll have to create a second group rate with the corrections. To ensure that the program calculates the tax amounts properly, I recommend consulting an accountant to confirm how each tax rate in the group needs to be set up, and whether they apply to the net, tax, or both amounts. You can invite your accountant to view your QuickBooks Online company from within the My Accountant page. If you're not already working with an accountant, you can use the Find a pro to help button to search for a QuickBooks-certified Pro Advisor near you. 

Let me know if you have any questions about the above steps!