Unable to Approve and Sync a Draft Invoice to Xero: 'Tax rate is invalid for this account type'

Topic

When trying to approve a draft invoice, you may encounter an error message that includes the words "Account type" - typically stating something like "Account type must be 'sales' or 'sales_or_purchases'". See image Below for Reference to this. 

This error happens when one or more line items on your invoice are linked to purchase account codes (such as Cost of Goods Sold account, i.e. a purchases account) instead of sales account code. This might be on the line itself in the Invoice or on the price list item profile in the Price list settings. In Tradify, invoices to customers must use sales-type accounts, while purchase accounts are meant for bills from suppliers.

How to fix it

The error message doesn't specify which line items are causing the problem, so you'll need to check your price list to identify and fix the issue. To do this: 

1. Navigate to Settings.
2. Select Price List.
3. Select Options > Export Price List File.
4. Search for an select the affected supplier list.
5. Select OK.
6. Select Download.
7. Open the downloaded CSV file in Excel or Google Sheets to look at the Account Code column and find any items with purchase-type account codes (such as 310, or any codes in the 300-399 range) that need to be changed to sales account codes.
8. Update any items that need to be changed to Sales accounts and Save the file. 
9. Then import the file back into Tradify for that supplier to update the supplier to the new account codes. 
   See here for how: How To Import a Supplier Price List

Important Note: Enter only the numbers, not the account name or description.
Correct: 200 
Incorrect: 200-Sales or Sales 

Additional Information

For more info on Xero errors, see here: Understanding Xero Error Messages