Hi, Mudenda. Let me clarify your situation and provide a fix.
When the NSF was coded to a zero-rated sales tax code, it was included in Line 101. After you changed it to a purchase tax code, it no longer belongs in Line 101.
The NSF falls within a period that has already been filed. QuickBooks records the change as a $450 exception that will adjust Line 101 in a future filing.
You have two ways to correct this:
- Make sure the NSF is coded correctly.
- Decide how to handle the exception.
If you choose Option 1, review the recorded NSF transaction. Make sure it is categorized to the appropriate expense or clearing account.
Note: The reconciliation tool’s Section 1 specifically flags “income transactions using purchase tax codes” because they create a mismatch with Line 101.
If you choose Option 2, you can leave the correction as is and include the $450 exception in your next GST/HST filing. QuickBooks will carry that exception forward and adjust Line 101 in the current open period.
If you need the previously filed Line 101 to match exactly, amend the prior return with the CRA to remove the $450 from Line 101, and then keep the corrected coding in QuickBooks.
You can use this article as a reference: Using the sales tax reconciliation tool.
Please consult an accountant or tax professional for advice tailored to your situation.
Let me know if you need anything else.
