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Hi -
I'm required to self-report provincial sales taxes (PST) on purchases of second hand equipment when the seller does not collect it.
I have created a supplier called "Second Hand Purchases".
Let's say I purchase an item for $100, and enter that as an expense (or bill) to the "Second Hand Purchases" supplier, with an "out of scope" value for the tax. This expense (total $100) will match with the cash withdrawal or electronic transfer from my bank account.
I also need to add $7 to a PST liability account; my preference would be the PST liability account that QBO created and uses to record the PST included in regular purchases where the seller charges this PST.
If I set the tax rate in the expense to the PST rate, it won't match the bank transaction amount.
I've tried adding a journal entry crediting the $7 to the PST liability account, but that requires an account to "debit"- but this is a liability that has yet to be paid!
I think I tried adding a bill to the PST liability account, but that wasn't allowed.
So how do I record this liability correctly so my year end reporting of what's owed is correct?
Thanks in advance!
Solved! Go to Solution.
Hi JulianR,
Thanks for getting back to me here. There currently isn't a way to record the purchase taxes separately in QuickBooks Online. If you'd like to see this available in product updates, you can submit a suggestion to our Development Team. Recommendations are greatly appreciated to improve your overall customer experience with QuickBooks Online. In the interim, you can have a look at third party apps for the best fit for your business needs. I hope you find this to be helpful.
If there's anything else we can help you with, feel free to reach out. We're here for you!
@Trish_T - I appreciate your honesty with regard to the shortcomings in Quickbooks.
Here is a *very* hacky work-around:
1. create a supplier, eg PST Tax Owing on Purchases
2. create a bank account called eg PST Tax Owing on Purchases acct
3. create an expense, with
- "PST Tax Owing on Purchases" selected as the supplier
- "PST Tax Owing on Purchases acct" set BOTH the payment account, and the category
4. enter values, memo, etc and save
By using the same account for the payment and category you will create equal deposit/withdrawals for each expense- the balance will always be zero.
The amount owing for the "PST Tax Owing on Purchases" supplier will also be zero, but the total column will have the sum needed. Add it to the amount of PST to be remitted available from the PST report.
Very. very ugly way to do this, but at least the information is all in one place.
Hi JulianR,
Welcome to Community! It's important that you're able to record PST accurately in QuickBooks Online. In this situation it's best to speak with your accountant for their expertise and best course of action. If you don't have one, we can help you locate a ProAdvisor in your local area. However, this is a great connection with other accountants and bookkeepers who may offer their support and advice as well.
Please don't hesitate to reach back out if you have other questions. We'd be glad to help!
Thank you @Trish_T .
So there is no straight forward way to record purchase taxes separately? This requires a $50-80 support fee from a third party? Ouch!
Hi JulianR,
Thanks for getting back to me here. There currently isn't a way to record the purchase taxes separately in QuickBooks Online. If you'd like to see this available in product updates, you can submit a suggestion to our Development Team. Recommendations are greatly appreciated to improve your overall customer experience with QuickBooks Online. In the interim, you can have a look at third party apps for the best fit for your business needs. I hope you find this to be helpful.
If there's anything else we can help you with, feel free to reach out. We're here for you!
@Trish_T - I appreciate your honesty with regard to the shortcomings in Quickbooks.
Here is a *very* hacky work-around:
1. create a supplier, eg PST Tax Owing on Purchases
2. create a bank account called eg PST Tax Owing on Purchases acct
3. create an expense, with
- "PST Tax Owing on Purchases" selected as the supplier
- "PST Tax Owing on Purchases acct" set BOTH the payment account, and the category
4. enter values, memo, etc and save
By using the same account for the payment and category you will create equal deposit/withdrawals for each expense- the balance will always be zero.
The amount owing for the "PST Tax Owing on Purchases" supplier will also be zero, but the total column will have the sum needed. Add it to the amount of PST to be remitted available from the PST report.
Very. very ugly way to do this, but at least the information is all in one place.
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