On June 5th, 2018, a change was made to how taxes are applied to invoices for Harvest accounts integrated with QuickBooks Online.

How did things work before?

Previously, Harvest allowed you to use the default tax rate you may have configured in your Harvest invoice configurations (found as a free-form field in your account under Invoices > Configure > Default Values). If you had a default tax configured, that tax would automatically be applied to all new invoices you created in your account.

What’s changed as of June 5th?

QuickBooks Online has started using Automated Sales Tax (AST), and because of that, we’ve had to change our functionality in order for our integration to continue working. The free-form tax field in the Default Values section of your account is no longer applied to invoices—rather, a tax rate that’s specifically pulled from your QuickBooks Online account must be chosen. There’s a chance that you sent invoices without either the previous Harvest default tax rate or without a tax rate from your QuickBooks Online account applied.

How do I know if taxes are being applied correctly now?

  • Harvest tried to match your previous default tax rate with a rate from your QuickBooks Online account. If we found an exact match, we set that as your new default tax rate in Harvest. You can change this at any time from Invoices > Configure > Default Values.
  • If we couldn’t find a matching rate from QuickBooks Online, or if you had multiple taxes in QuickBooks Online with the same rate, you’ll need to manually choose a new default rate. To do that, head to Invoices > Configure > Default Values.

What about invoices sent between June 5th and July 20th?

You may have sent invoices that had no tax rate applied. We recommend checking any invoices between June 5th and the time of reading this, to make sure your clients were charged the appropriate taxes.

Does this affect my recurring invoices?

For Harvest accounts connected to QuickBooks Online accounts that aren’t using AST, recurring invoices with a Harvest tax rate applied have a separate, but related, issue. If you have recurring invoices in your account, you may have noticed that the tax rate from your invoice in Harvest is being zeroed out once the invoice is copied to QuickBooks Online. Your Harvest invoice does have tax applied and your client is being charged that tax on their invoice—however, since the tax rate isn’t a QuickBooks Online rate, it isn’t being copied over.

To fix this, you’ll need to edit each recurring invoice in your account, from Invoices > Recurring, and select to apply a QuickBooks Online tax rate. This newly selected rate will override the Harvest tax rate for all new invoices created off that recurring invoice.