Integrate Anrok & QuickBooks

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Introduction

This guide outlines the process for linking your QuickBooks account with Anrok. This will allow you to automatically synchronize transactions and update sales tax to your QuickBooks invoices.

Click here to take a look at how the Anrok & QuickBooks integration works 

Integration architecture

From a high-level perspective, Anrok is an end-to-end platform for managing tax compliance. Anrok assesses the taxability of a transaction and applies sales tax if applicable. In addition, Anrok helps track nexus and exposure by aggregating all transactions for a given jurisdiction and monitoring relevant state thresholds. Anrok also fully automates jurisdiction registrations, returns filing, and remittance.

 

The diagram below depicts the key Anrok integration points for a typical QuickBooks transaction:

Transaction example

Quickbooks_billing_enterprise_transaction.jpg

  1. Invoice creation: the billing team creates and saves an invoice in QuickBooks. 
  2. Calculate and record tax: QuickBooks notifies Anrok of the updated invoice and sends all relevant information for tax calculation - including the products sold and customer address. Anrok calculates the relevant tax amount and updates the QuickBooks invoice using the QuickBooks API. You can continue to update items on the invoice, and tax will be updated accordingly in both QuickBooks and Anrok.
  3. Payment: sellers are required to remit sales tax to a state upon invoice, not receipt of payment.

 

 

Step 1

Connect to QuickBooks

The first step of integrating with QuickBooks will be connecting directly to your QuickBooks account within Anrok. During this process, you must align your accounting time zone and provide the credentials associated with your QuickBooks account.

Try connecting to QuickBooks in the demo above ☝️

  1. In the Anrok app CleanShot 2023-07-20 at 12.02.21@2x.png, go to Data sources. Take me there!
  2. Select Integrate system, then under Accounting time zone, select the time zone that matches your QuickBooks account. QuickBooks will default your time zone to the same location as your company address.
  3. Under Data source, select QuickBooks.
  4. When prompted, click Connect to QuickBooks, then sign in with your QuickBooks credentials and complete the two-factor authentication.
  5. Once you see "anrok_connect_checkmark.png You are now logged into QuickBooks”, click Connect.

 

 

Step 2

Add your QuickBooks products and services as Product IDs

In Anrok, your QuickBooks products and services will be called product IDs. These product IDs are the key driver for calculating taxability. It's important that you add your QuickBooks products and services into Anrok. See What are product IDs?

Try adding your QuickBooks products in the demo above ☝️

  1. Under New products detected, select a corresponding Product type and Tax category for each product detected. See Select a tax configuration.
  2. If you'd like to assign a Product type and Tax category to multiple products at once, click the checkbox  anrok_checkbox.png  next to each product, then select Batch assign.
  3. When you are finished, scroll down and click Add products.

 

 

Step 3

Import your QuickBooks transactions

Now that you've assigned all your product IDs, You can now begin importing your historical transactions from QuickBooks into Anrok.

Try importing your QuickBooks transactions in the demo above ☝️

  1. Under Select transactions to import, select one of the following options:
    • Import all past transactions — all transactions will be imported into Anrok. This will result in a complete picture of your economic nexus exposure.
    • Import transactions from a specific date — some past transactions will not be imported into Anrok. This may result in an incomplete picture of your current economic nexus exposure.
    • Continue without importing past transactions — none of your historical transactions will be imported into Anrok. This may result in an incomplete picture of your economic nexus exposure.

  2. Select Import transactions (or Mark as finished depending on your 

    previous selection).
  3. When your transactions have finished importing, select Mark complete.

 

 

Step 4

Manage setup for external updates

Anrok requires that you set up and manage external updates between Anrok and QuickBooks. Setting up these external updates in Anrok will help ensure Anrok can calculate tax on your transactions.

Try managing setup for external updates in the demo above ☝️

  1. In the Anrok app CleanShot 2023-07-20 at 12.02.21@2x.png, go to Data sources. Take me there!
  2. Under Integration sources, click the Options menu button anrok_option_menu.png next to QuickBooks, then select Manage setup for external updates.
  3. If external updates to your QuickBooks invoices are disabled, click Enable.
  4. Under Automated sales tax, review whether Automated sales tax is enabled. 
    • If you see a Warning icon  possible_exposure_warning_anrok.png , you will need to set up Automatic Sales Tax in next (Step 5). 
  5. Under Products, review whether all of your QuickBooks items are considered taxable. 

    • If you see an Information icon  CleanShot_2024-04-10_at_16.29.37_2x-removebg-preview.png  stating that your QuickBooks account contains non-taxable products, click Fix issue.

       

      Tip CleanShot_2024-04-30_at_15.47.03_2x-removebg-preview.png

      Don't worry about a non-taxable product getting taxed! If a product is non-taxable, you can select a non-taxable tax configuration when setting up its product ID in Anrok. If the customer is tax-exempt, you can upload the customer's exemption certificate.


       

  6. Under Customers, review whether all of your QuickBooks customers have a 0% default tax rate.
    • If you see an Information icon  CleanShot_2024-04-10_at_16.29.37_2x-removebg-preview.png   stating that your QuickBooks account contains customers without a 0% default tax rate, click Fix issue.

Any fixes made while managing QuickBooks setup for external updates will require up to 30 minutes to fully apply in QuickBooks. While these changes occur in the background, proceed to Step 5. 

 

 

Step 5

Activate automatic sales tax in QuickBooks

If you have not done so historically, you will need to activate Automatic Sales Tax on your QuickBooks account to allow Anrok to calculate tax on your invoices.

Try activating sales tax in the demo above ☝️

  1. In the QuickBooks app CleanShot 2023-07-19 at 15.00.11@2x.png, go to Sales tax. Take me there!
  2. Click Use Automatic Sales Tax, then enter your business address. Automatic Sales Tax is only available for US QuickBooks accounts. 
  3. If asked: Do you need to collect sales tax outside of state?, select No.
    • Please note: during this process, QuickBooks selects a placeholder tax agency. The specific state or tax agency chosen at this step is not relevant to the Anrok integration. 
  4. If asked: Have you registered for sales tax with any other agency?, select No.
  5. Under Filing frequency, select Monthly.
  6. Click Save.

See our FAQ for more information about QuickBooks Tax Agency settings while using Anrok. If you have VAT IDs to add for customers, don't forget to complete Step 6. If this is not required for your business, then your QuickBooks integration setup is complete.

Note CleanShot_2024-04-30_at_16.01.40_2x-removebg-preview.png

Before you begin creating and editing invoices, review our QuickBooks Invoicing Requirements to make sure each invoice is properly created to ensure accurate tax calculation. 

 

 

Step 6

Create a custom field for customer VAT IDs (Optional)

Adding a VAT ID to your customer's invoices will be essential for tracking international economic nexus and exposure. To display a VAT ID on your invoices, you will need to create a customer_tax_id Custom Field on the QuickBooks Customer. Once this custom field has been created, Anrok can use your customer's VAT ID to verify an invoice's taxability in a given country or region.

  1. In the QuickBooks app CleanShot 2023-07-19 at 15.00.11@2x.png, go to Settings ⚙ and select Custom fields. Take me there!
    • QuickBooks requires that this custom field be one of the first three Text and number custom fields created on your QuickBooks account including inactive custom fields.
    • If you already have created three previous Text and number custom fields on your QuickBooks account, you will have to repurpose one of your existing custom fields for customer_tax_id or customer_tax_id_2. This QuickBooks documentation provides more information about this restriction. 
  2. Click Add field.
    • If you are using QBO Advanced, we recommend using a Customer-level custom field to persist the ID across all future transactions for that customer.
    • If you do not have QBO Advanced, then you can use a Transaction-level custom field instead. Transaction-level fields can be added to recurring invoice templates to avoid needing to copy the field manually to each invoice. 
  3. For the data type, select Text and number. 
  4. In the Name field, enter customer_tax_id or customer_tax_id_2.
  5. Check the box for All Sales forms.
  6. Click Save. 

Note CleanShot_2024-04-30_at_16.01.40_2x-removebg-preview.png

Contact technicalsolutions@anrok.com to enable adding customer tax IDs in the invoice private note if you think this solution would work better for your company.

 

Now that you’ve set up your QuickBooks account to work smoothly with Anrok, don't forget to review our QuickBooks Invoicing Requirements to make sure each invoice is properly created to ensure accurate tax calculation. 

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