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joanie56
March 12, 2019
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How do i record a GST/HST payment owed to the CRA due to a re-assessment?

  • March 12, 2019
  • 3 replies
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I was re-assessed by the CRA and due to some expenses made we are not able to claim I know need to pay back GST/HST  to the CRA.  When i try to to record it in quick books as paying Revenue Canada and the expense being GST/HST Quick books tell me I can not do that as it will adjust my GST/HST account.  How do i record this with out changing my year end GST/HST.

Best answer by NEVER

You do not use the GST Liability account to record this transaction. Instead, create an Expense type account in your COA called Non-Refundable Taxes (or something that makes sense to you. Now use the Write Cheques function, payable to Receiver General,  Non-Refundable Taxes as the account, enter the amount without a Tax Code. This method will not alter the GST Payable account.

3 replies

N
NEVERAnswer
March 12, 2019

You do not use the GST Liability account to record this transaction. Instead, create an Expense type account in your COA called Non-Refundable Taxes (or something that makes sense to you. Now use the Write Cheques function, payable to Receiver General,  Non-Refundable Taxes as the account, enter the amount without a Tax Code. This method will not alter the GST Payable account.

J
joanie56Author
March 12, 2019
Thanks for your help.. I created the new expense account and completed the transaction.
N
NEVER
March 12, 2019

Non-Refundable means you do not get it back - now or in a later Tax period. Generally, using Tax Codes in transactions increases or decreases the Tax in any given Tax Period. If the transaction has been recorded using an appropriate tax code, it has already affected the Tax Return and there is nothing to claim. If this is not what has happened, you can use the Adjust Liability function to reduce the Liability account.

    V
    Vernonina
    March 12, 2019
    Ok...so this thread so the closest I could find to my original situation. We were re-assessed by the CRA and the HST was deemed un-claimable and therefore we had to pay them back for it. However, since we had not completed the adjusting entry yet nor made any payment, we are now in a situation where we can re-claim what was deemed un-claimable. The original entry for the HST is in a previous filing, how to do we re-claim the HST for this current period? I hope that made sense.
      N
      NEVER
      March 12, 2019

      So.... did you only remit the GST Return (the one that was reassessed) without payment? If this is the case, then pay the entire amount due. There is nothing more to do. 

      If you did pay what was owed on the original return, create a Bill Credit using Receiver General as the Vendor and select your GST Liability account under the Account tab (not the Item) on the Bill Credit. Do NOT use a tax code.Next time you file your GST return, file it in QB first. Make sure you select Enter a bill to pay later (Not sure what the exact wording of the popup is). Now, go to Pay Bills, select Receiver General and apply the Bill Credit to reduce the payment.

      Now, you can file the Payment with the CRA and pay the reduced amount.

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