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Super Contributor *

Allocation of tax codes to customers/suppliers

Hello to all the experts :-)

 

Couple of questions please.

 

1)  When recording or Sales/COGS we can select one on two options:

 

- Sales Company A / COGS Company A

- Sales Company B / COGS Company B

 

The tax allocation for these transactions is dependent on both the customer and supplier vs the actual chart of account number.

 

  1.  In our current system ( MYOB)  we assign the income account and associated tax code to a customer card which will serve as a default when entering our sales for that particular client.
  2. We can also allocate all our expenditure to one COGS account but the associated tax code is based on the actual supplier (local may be GST vs international companies not charging GST) .  The tax code is reflected in the actual supplier card

Can this be done in QB and if so how?

 

Question 2:

l  am currently playing in the Test Drive system. When I enter an expense (eg Equipment rental) a default tax code is not shown in the record but rather it is up to the user to enter.  Is it possible to have a default tax code assigned against our expense categories.

 

 

Thanks once again for your help!

 

Solved
Best answer 07-06-2019

Accepted Solutions
QuickBooks Team

Re: Allocation of tax codes to customers/suppliers

Hi again, Koala.

 

Thanks for getting back to us with more info. What you've described when it come to COGS is currently unavailable in QuickBooks Online. 

 

We're unable to assign default GST codes to suppliers, only to categories. This means that you will have to manually select the correct GST code that'll be used for the bill, unless you're using a category with a default code assigned to it.

 

The scenarios you've shared in this thread will be sent to our engineers as a feature request. They can take a look at this and check if they can add them in our future updates. 

 

Visit us again in the Community if you have other questions. 

4 Comments
QuickBooks Team

Re: Allocation of tax codes to customers/suppliers

Hi there, Koala.

 

While we can't assign income accounts to customers, you can create an item that's unique to them and assign their own income and COGS account. Here's how:

 

  1. Go to your Products and Services window.
  2. Click New and select Inventory.
  3. Go to the Income account and Expense account fields and assign the customers unique income and the supplier's COGS account.
  4. Click Save and close.

Also, it's possible to assign a default tax code to a your expense categories. Once assigned, it will automatically show up when recording your expenses in QBO. Here's how:

 

  1. Go to your Chart of Accounts and look for the expense category.
  2. Click the drop-down arrow beside Run report and click Edit.
  3. Assign a default tax code in the Default GST Code field.
  4. Click Save and close.

Let me also share these articles for more details:

 

Let me know if you need anything else. I'd be glad to get back here and offer more help.

 

 

 

Super Contributor *

Re: Allocation of tax codes to customers/suppliers

Hi @JenoP 

 

Thanks for your detailed reply and screen shots.

 

We do not operate an inventory system and hence do not believe your solution will work for us but thanks so much for all your advice. .

 

I may not have explained myself correctly as an example (using COGS) :

 

1. We have only TWO COGS accounts (and unwilling to set up more) where all our supplier invoices are allocated. These invoices are from a variety of suppliers however they are all allocated to either one of these two COGS accounts.   For purposes of this example let call it COGS account 5-1000

 

We may get an invoice from a Wine Supplier. They do NOT charge GST

- When I enter his Bill I will allocate it to the Cost of Sales Account (Category) and enter the description and Amount.  I am therefore wondering if QB will automatically exclude any GST on this bill (Based on the Supplier)

 

The second scenario:

We may get an invoice from a Printing Company - They DO charge GST

 

- When I enter his Bill I will allocate it to the Cost of Sales Account (Category) and enter the description and Amount.  I am therefore wondering if QB will automatically INCLUDE any GST on this bill (Based on the Supplier)

 

i.e. 2 different suppliers are allocated to the same COS account. One charges GST and the other excludes it.  How / Can QB determine which tax coded to use.

 

Question 2.

- I followed what you said regarding changing the default GST code in the Cost of Sales account however the GST field is blank when I create a bill?  It is also letting me save without any warnings advising that a tax code and class has not been entered. Can we establish these warnings.

 

Many thanks for all your assistance.

 

 

 

QuickBooks Team

Re: Allocation of tax codes to customers/suppliers

Hi again, Koala.

 

Thanks for getting back to us with more info. What you've described when it come to COGS is currently unavailable in QuickBooks Online. 

 

We're unable to assign default GST codes to suppliers, only to categories. This means that you will have to manually select the correct GST code that'll be used for the bill, unless you're using a category with a default code assigned to it.

 

The scenarios you've shared in this thread will be sent to our engineers as a feature request. They can take a look at this and check if they can add them in our future updates. 

 

Visit us again in the Community if you have other questions. 

Super Contributor *

Re: Allocation of tax codes to customers/suppliers

Thank you for the speedy response.

 

Appreciate all your efforts