QBO API V3.0: Overriding Invoice TaxAmount

Question

After experimenting with V3.0 API to create invoice in QBO we have verified that it is possible to override the tax amount when creating an invoice.

We have also verified that the tax reports are correct in that the tax amount in the invoice is split over the tax components (for a combined rate) using the same ratio of the component tax rates.

What we are struggling to understand is what would be a business scenario where a user would need to override an invoice tax amount. The reason I ask this is because although the API does the maths properly, we can't make sense as to when this would happen in the real world.

Thank you very much in advance.

Answer 1

In QBO you have defined taxrates set in the tax center and you can use only those while creating and Invoice or any other transaction. BUt if you want to assign some custom tax rate on the fly, then it is not possible via the API. In such cases, you need to override the tax amount that you have set so that you can customize it as per your requirement.

Answer 2

One reason for being able to set custom tax rates is if you have mixed product in your invoice. For example, you have an invoice with regular items and grocery items (which has a different tax rate). Or, let's say you have a customer that is not tax except, but one of your individuals line items is.

In those instances, being able to use or set varying tax rates is appropriate.

Answer 3

If the sale occurs in another system and you insert the transaction into QB after the fact, using the API, you need to record the actual amount of tax collected, even if it's wrong, for tax reporting purposes. For example, you might have a retail point of sale system where the tax rates were set up incorrectly.