What changed
If your company uses QuickBooks Online (US), Factory can now have QuickBooks work out your sales tax automatically from the order's address — this is called Automated Sales Tax. You can also keep using your own custom tax rates instead, if you prefer.
New orders vs existing orders
Orders created before this change aren't recalculated — they keep the tax Factory worked out at the time.
Orders created after this change show Factory's own estimate until the order is sent. Once it's sent to QuickBooks, Factory shows the tax figure and rate QuickBooks calculated. Editing and resending an order asks QuickBooks again.
Quotes always show
Calculated at submit, since QuickBooks doesn't calculate tax on quotes — only on sales orders and invoices.
Setting up Automated Sales Tax
In QuickBooks, turn on Automated Sales Tax and add every state you're registered to collect tax in. Worth confirming this with your accountant first.
In Factory, go to
Settings > Integrations > Update Accounting Dataand confirm it shows "Sales tax: Calculated by QuickBooks."
Run
Update Accounts & Tax Codeand confirm your Income and Expense accounts.
*Clear any leftover fixed tax rate on customers (Settings > Tax) and on draft orders (Custom tax rate), unless you specifically want that rate to always apply.
✋ Watch-out
A custom tax rate always overrides the address-based calculation — even for a state you're not registered in, or a tax-exempt customer. A leftover custom rate is the most common reason Automated Sales Tax "isn't working," so check for one first.
On Automated Sales Tax, QuickBooks works out each order's tax from the delivery address
A new Tax column: each line is With tax or No tax.
On a draft the Tax row reads Calculated at submit, and the card ends Syncs to QuickBooks with tax calculated by QuickBooks.
On submit QuickBooks works the tax out and Factory shows it, with the rate and the new total: Tax (10.25%) $10.25 on a $100 Los Angeles order. The timeline says what changed: QuickBooks worked out the tax as $10.25 (Factory estimated $0.00) via order submission. Total is now $110.25.
A warning shows when the company doesn't collect tax where the order is going: Not registered to collect in Texas, or No sales tax will be charged outside the US.
Edit Order then Update Order keeps QuickBooks' figure. A new delivery address gets a new one when resubmitted. Partial invoices keep the tax of the lines they invoice.
A custom tax rate can be set on an order or on a customer
Custom tax rate on a new draft: pick one rate, such as Tucson — 9.1%. It saves straight away, and it's gone once the order is submitted.
On Automated Sales Tax a picked rate replaces QuickBooks' address-based tax: Tucson on a Los Angeles delivery charges $9.10, not $10.25.
On custom rates the tax is worked out straight away from the order's rate. With no rate, no tax is charged.
The customer page › Settings › Tax shows an Automated Sales Tax or Manual Rates badge, a Custom tax rate that new orders start with, and Default new orders to tax free. Each change saves as it's made.
Troubleshooting: If tax is showing as $0
Check the order's state is registered for tax collection in QuickBooks.
Check whether the customer is marked tax exempt in QuickBooks.
Check whether any lines are set to "No tax," or the order's tax-free switch is on.
Check whether the order has actually been sent yet — tax only calculates once it reaches QuickBooks.
Good to know
Factory only picks up a change you made in QuickBooks (like turning on Automated Sales Tax, or adding a state) the next time you run
Update Accounting Data— connecting, pressing that button, or openingUpdate Accounts & Tax Code. It doesn't re-check automatically when an order is sent or overnight."Default new orders to tax free" only changes how new lines start out on new orders — it doesn't change existing orders or lines.
Mobile and API-created orders don't yet use a customer's custom tax rate — that's separate, upcoming work.