How to Change Tax Rates in Quickbooks (Complete Guide)

August 11, 2022

How to Change Tax Rates in Quickbooks (Complete Guide)

While QuickBooks is very user-friendly and aids in keeping your company's finances and taxes current, there are a few things that you, as a user, need to be informed about how to change tax rates in QuickBooks.

While QuickBooks is relatively user-friendly and aids in maintaining the accounts and taxes for your business, there are a few aspects that you, as a subscriber, need to be informed about.

One of these factors occasionally involves:

  • How to change tax rates in QuickBooks;
  • How to change SDI in Quickbooks;
  • How to change sales tax in QuickBooks; 

Just to name a few. However, this article will strive to make things simpler for you

How do I change annual tax rates in Quickbooks?

The steps below can be used to change annual tax rates in Quickbooks.

  1. Choose Edit from the main menu.
  2. Choosing Preferences, then clicking Sales Tax
  3. Activate the Company Preferences Tab.
  4. Mark Yes for the question "Do you charge sales tax?"
  5. Then select Add Sales Tax Item.
  6. Type in the tax's name and rate. You can provide a brief description as well.
  7. If relevant, type the name of the tax agency here.
  8. Hit Ok.
  9. Type in a sales tax code. The tracking of taxable and non-taxable sales is made simpler by these codes.
  10. Choose cash or accrual as your tax base.
  11. Choose the time frame during which taxes must be paid. (yearly, quarterly, and/or monthly)
  12. Hit ok.

How do I change tax rates in Quickbooks?

If the financial institution has implemented a new tax rate, you can edit the sales tax rate for every customer at once on QuickBooks Desktop. However, you have the option to alter the tax rate each time you conduct business with a customer.

To effectively achieve this employ the following steps;

  1. Go to the Reports option in the top menu of your QuickBooks company page
  2. Select List from the drop-down menu by clicking on Reports.
  3. Select "Item List" from the drop-down menu.
  4. All of the items that are in QuickBooks will be displayed. You can alter it if you'd like.
  5. To do that, locate Customize Report in the top menu bar, then click it.
  6. Go to the Reports option in the top menu of your QuickBooks company page.
  7. Select List from the drop-down menu under Reports by clicking there.
  8. Click on Item List in the drop-down menu.
  9. It will display every item that is listed in QuickBooks.
  10. You can also alter it if you'd like.
  11. To do that, locate Customize Report in the top menu bar, then click it.
  12. Click on Filter in the newly opened window.
  13. Select Account after that, then choose All Liabilities from the drop-down box.
  14. Click OK again.
  15. You'll observe that you'll just receive your sales tax from this.
  16. You should print the sales tax list, as this is advised.
  17. To accomplish it, click the Print button in the menu bar and choose Report from the list.
  18. Let’s proceed, click List from the menu bar after verifying the sales tax rates from the website.
  19. Select Item List from the drop-down menu.
  20. By right-clicking on the city or county and selecting "Make item inactive," you can make the old rates inactive without having to go to the list of cities that have changed their rates and make the changes there.
  21. Then scroll down the page and select Item.
  22. On the list, select New, and click the Sales Tax Item for the Type to bring up a new page.
  23. Put the name of the county, district, or any way you want to designate it for sales tax in this field. Name
  24. Enter the Sales Tax City under the Description (name).
  25. Check the city's tax rate on the Tax rate page, then input it under the Tax Rate field.
  26. You must next enter the name of the vendor you collect the money from under the Tax Agency Vendor heading. Choose it from the drop-down list that is present. You can research the vendor online. Lastly, select OK.

How do I change the Tax settings in Quickbooks?

The accounting software automatically applies this tax setting to all transactions that are entered.

By using the procedures listed above, you can alter QuickBooks' default tax settings.

1. Select "Employee Center" from the "Employee" menu.

2. Select the "Employees" tab, then double-click on the name of the worker whose local payroll tax rate you want to modify.

3. From the drop-down option on the "Change" tab, choose "Payroll and Compensation Info."

4. Select the "Other" tab from the "Taxes" button.

5. After deciding which tax has to be modified, enter a new rate in the Rate area. We presume that the rate is a percentage.

6. To save the new rate, click the "Save" button.

Steps to Change Sales Tax Rate in QuickBooks Desktop?

If the financial institution has implemented a new tax rate, you can adjust the sales tax rate for every customer at once on QuickBooks Desktop. This is how;

  • Click the Lists option in the upper menu bar.
  • Next, choose Sales Item from the drop-down menu by performing a right-click.
  • A fresh window will now appear. Enter the new rate in the Tax Rate (percent) column here.
  • Additionally, you can update the Sales Tax Name and include a description. After that, press OK.



LiveFlow supports real-time collaboration, account consolidation, and automation of financial workflows. We assist businesses in creating the comprehensive income statements they require to quickly set up their cost and revenue categories, allowing banks and accounting firms to gather all the financial information in one location and produce real-time, up-to-date overviews of cash flow and liquidity.

How you used to do it downloaded unwieldy CSV files with messy, disorganized data. Why LiveFlow can be useful: Data from QuickBooks may be directly imported into Google Sheets. If you're not yet convinced, you may check all of our satisfied customers' reviews here, many of whom have given us five stars.

Join the liveFlow family by signing up for a free trial. Also, you can schedule a live call with us or look at some of our templates.

Turbocharge QBO with LiveFlow
Cta Photo
The smartest finance pros know LiveFlow.
Save time and stress on your reporting!
Book a demo

Continue reading

Set your financial reporting on autopilot. Goodbye manual work.

Eliminate manual data entry and create customized dashboards with live data.