Hey Deidre61,
It's great that you're taking an active approach to make sure your books are consistent. Keeping an eye on your sales tax amounts by comparing reports is the best way to avoid surprises, and goes a long way to help produce accurate filings. QuickBooks Online is equipped with powerful tax tracking features to support you every step of the way, and I'm confident we'll have no problem getting the numbers to line up. There are a few things that can cause this discrepancy, and I'll be happy to look into those with you.
Before going into specifics, it's worth understanding how sales tax tracking works in QuickBooks Online. The tax centre is focused on the tax codes you select on transactions, rather than the tax liability account itself. The amounts are then mapped to your return accordingly. This is why the system is able to consistently produce accurate reports using a single liability account. With this is mind, the most common causes for discrepancies are the following:
- Unfiled sales tax amounts before the first filing period are simply tax amounts that were never marked as filed in QuickBooks. These will naturally remain in your GST/HST Payable account unless they are cleared out.
- Unfiled sales tax amounts after the last filing period are just amounts that haven't been filed yet, but will be included on a later filing. This is typically nothing to be concerned about, but it's important to make sure you're always comparing reports with the same period.
- Unmapped manual adjustments to the GST/HST Payable account are common when taxes are recorded manually on a journal entry. When selecting your tax liability account on a journal entry, make sure to always map it to a specific return line using the Sales Tax column.
- Amounts represented in the GST/HST Suspense account including filed returns, payments, and instalments. To make things more digestible, filed returns and payments are tracked to a separate liability account.
This great article plenty of additional pointers: How to use reports to troubleshoot problems with sales tax amounts
Most of these errors are easily identified by running the balance sheet for your filing period, and then clicking the GST/HST Payable amount. Your accountant is an incredible resource for additional help with this, and they'll be able to efficiently make necessary adjustments. You can easily invite your accountant as a user so you can sort this out as a team. To find one in your area, simply head to the My Accountant tab in QuickBooks Online then click on Find a pro to help.
Don't hesitate to let me know if you have any other questions.
