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bwaycas
June 12, 2019
Question

Sales tax

  • June 12, 2019
  • 2 replies
  • 0 views

One of my clients was late in paying his GST amount owing to the CRA. He then had a refund for his corporate income taxes. CRA took out the GST amount owing out of his refund and refunded him the difference.

 

How do I record this in QB? Sales tax has already been filed in quickbooks so I have an outstanding bill to CRA that need to be cleared.

 

Thank you in advance.

2 replies

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LauraAB
June 12, 2019

Hi bwaycas,

 

Making sure you record this sort of situation properly in QuickBooks is important. I recently answered a question about this from another user the other day and with the help of some community accountant users that also responded, I'm confident you'll find the answer you need. Here's the question with the answers: Balance Owing for GST at year end - Canada Revenue Transferred Balance from a CT Refund

 

Don't hesitate to reach out again if you have more questions. :) Enjoy your day!

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bwaycasAuthor
June 12, 2019

These steps do not clear my bill for sales tax. In order to clear the bill I would need to pay it from a bank type account.

I have created a clearing bank account that can be used for this purpose but I am not sure what to choose for "from account" when making a deposit of the funds to be used for payment.

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LauraAB
June 12, 2019

Clearing the payable account for the Sales Tax in question should remove the bill created from filing the sales tax from the Pay Bills feature. To see what you're seeing, I recommend getting in touch with our phone support team. A screen share session will allow an agent to follow what you're doing as you go through the steps and see how you've got your QuickBooks configured. The number is 1-877-772-9158. Pro and Premier agents can assist at your convenience since they're available 24 hours a day. Enterprise agents are on hand from Monday to Friday between 9 a.m. and 8 p.m. EST.

 

Knowing which accounts to use is a bit beyond the scope of tech support, so I'll leave it to our accountant users to chime in on this one. Or you can consult your own accountant if you one. If not, find an accountant familiar with QuickBooks through our Find a ProAdvisor page.

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NEVER
June 13, 2019

I would: Use the Receive Payment function to receive the Corporate Tax Refund (the entire amount without deducting the GST) and deposit the entire amount to Undeposited Funds. That will clear the Corporate Tax refund from Receivables.

Next, make 2 deposits from the Undeposited Funds account: the GST amount deducted to a Contra account (not a real bank account)  and the balanceof the Corporate Tax refund to a Bank account.

Pay the GST owing from the Contra account using the Pay Bills function. This will clear the GST Payable.

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