How do I include a HST installment payment made after fiscal year end in my annual return?

[CDKC70]

My year end was the end of February and I made my last quarterly HST installment payment at the end of March.  When I pull up my sale tax report to file my annual return, it does not include the last HST installment, since it happened after the fiscal year end.   Is there a way to correct this?

[AddieC]

Hi there, 

Recording your HST installment payment is an important part of proper bookkeeping. I'd be happy to help clarify this for you. 

I'd recommend consulting with your accountant first and foremost. Make sure to clarify with them whether or not the HST installment payment should be recorded for the fiscal period in which it belongs, or if it's best practice to record it using the date it was physically paid. 

If your accountant suggests recording this HST payment within the fiscal year in which it belongs, here's how you can change the date of the HST installment payment in QuickBooks Desktop: 

1. Go to the Company menu and select Chart of Accounts.

2. Go to the account the payment came from.

3. Double click the account to open the account register.

4. Find the payment transaction in the register.

5. Double click the payment transaction to open it.

6. Change the date of the payment.

7. Read the warning and click Yes to save the change.

I hope this helps. If you have any further questions, please feel free to reach back out. 

Cheers!

[Rochelley]

Your installment payments should be recorded in your bank account as payable to your HST vendor (Receiver General - or whatever you have named it).  The account used on the cheque payment should be Accounts Payable, then tab over to 'Customer:Name' and type in your tax vendor name again.  This records the payment into your A/P ledger as a (-) balance for that tax vendor.

When you file your HST return, the last step of filing transfers your return amount to A/P, offsetting your installment payments.  When you go to 'Pay Bills' to pay the tax vendor, apply all the credits you have paid as installments against the return amount and you should only have to pay the difference which is now the amount showing as owing.  In the case that you've overpaid the HST for the period in your installments, you should be receiving a refund.  Your A/P balance will remain in a (-) balance until you receive your refund, at which time you will debit the bank, and credit the HST vendor A/P.

When you filed your annual tax return, it created an A/P entry on the date of the end of your period.  Your installment payments can be made at any time before or even after the end of the period.  It will not affect anything other than your A/P balance and bank balance (balance sheet entries) because you are simply putting money towards your outstanding tax liability.

[MohnishP]

I just posted about this same issue on another thread: "GST/HST Installments and Annual Returns"

Hope that helps resolve this, although this is an old thread.