Hi, How would we make an entry for a Govt subsidy for fuel?

Hi Jammawais,

Welcome! Thanks for joining us here in the QuickBooks Community. This forum can serve as a helpful resource for learning how to use QuickBooks Desktop and get insight from others on how to go about certain tasks. I'll point you in the right direction for learning how to enter a government subsidy for fuel.

The best way to approach this situation is to connect with an accountant. There isn't a recommended guide for entering these kinds of transactions, but an accountant can let you know what this sort of transaction should look like, and if they're familiar with QuickBooks Desktop, that's an added bonus. They may suggest something like a journal entry or deposit transaction, but knowing which, if either of these, is more appropriate is where their expertise comes in.

If you don't already have an accountant you're working with, head on over to our Find an Accountant page where you can research professionals near you that know the software. When you enter your city or postal code, you'll see listings for accountants, reviews from their clients, and details about what they can offer.

You may also get input on this thread from other users, but it never hurts to have an accountant on your side.

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Hello @Jammawais ,

You can do one of two things:

1.  Create an Other Income type account called Fuel Subsidies and CR that account in your entry or

2.  Post a CR to your Fuel Expense account.

Either way will produce the desired end result.  Either your income is increased, or your expenses are decreased; same bottom line. It really depends on how you want to see this entry on your financial statements.

If you choose to record it under an income account, it should be account type Other Income so as to differentiate from income derived from operations, meaning the income from whatever it is you do as a business.

If you choose to credit your Fuel Expense account, then it will be buried and you will only see the net amount of your Fuel Expense for the period.  Of course you can always drill down on this account in a report to find the lines that were entered as the subsidy amount(s).

It wasn't clear from your initial post how you are receiving this subsidy.  Is it a straight-up cash rebate which you deposit to the bank, or is it a "reduction" in other amounts you are paying to the Government?  If it is coming to you as cash, then you would create a deposit and enter the government agency name, and post to the account you've chosen to use.

If it is a reduction of amounts you are paying to the Govt, create another line in the form you are recording this payment in, either a cheque or a Bill, and enter the amount of the subsidy as a negative, resulting in a lower net payment to the Govt agency.

Hope that helps.  Cheers!