Overview
BQE CORE supports California’s 7% withholding tax regulation on vendor payments made to non-resident vendors. This ensures compliance with the California Franchise Tax Board (FTB) requirement to withhold and remit tax on services performed in California by vendors who do not have a physical presence within the state.
When enabled, CORE automatically calculates and records the withholding on qualifying vendor bills, adjusts the net payment to the vendor, and posts the related journal entries to the designated liability account. CORE remembers the previous Tax Withholding column visibility and vendor opt-in/out settings when disabled, and restores them when re-enabled. Click here to watch a video on Nonresident Tax Withholding in CORE.
Note: Withheld amounts must be remitted quarterly to California Withholding Services. To ensure tax withholding is applied, verify that the State field is filled on the Projects detail screen for all California-based projects and on the Vendors detail screen for all associated vendors. If the State information is missing, CORE will not apply withholding. Check out this blog post on California’s Nonresident Tax Withholding for Vendor Payments for more.
CORE automatically displays the State column on the Projects and Vendors grid (list view) when accessed through Quick Links from the Tax Withholding Settings screen or the Create Vendor Bill screen. This ensures that you can easily confirm or correct missing state data required for withholding without manually adjusting column visibility. The override applies only during that session and does not affect your saved column settings. Check CORE Help Center for details.
Field Descriptions
| Field Name | Field Description |
| Settings > Accounting > | |
| California Non-Resident Tax Withholding |
When this option is enabled, CORE automatically applies a 7% withholding tax to vendor bill line items for services performed in California by vendors whose business location is outside the state. The withholding applies only to service-type items and excludes goods. This setting is off by default. When this option is enabled for the first time, vendors with a state value of CAL, CA, or California remain unchecked (not opted in). All other vendors are automatically checked, i.e., opted in by default. |
| Withholding Tax Account | This is the liability account to save withheld amounts. Only liability-type accounts appear here. You can select an existing account or add a new one. |
| Reminders | These are system notifications that can be sent to the selected users on the first day of each month to pay the withheld tax liabilities. CORE allows you to choose one or more users who should receive these notifications. This helps ensure timely payment of withheld taxes and compliance with state withholding requirements. |