Question

inputting HST on imported goods

Forum|Forum|6 years ago
January 26, 2020
17 replies
18 views

I often have items coming into Canada that are not charged. But customs charges HST on the declared value. These could be warranty parts, items for service or returning items.

I am not charged, but HST is charged by customs. How do I input these into Quickbooks so it shows up as HST paid/payable?

QuickBooks Desktop

L

LauraAB

Level 8

Hello Dan188,

It sounds to me like you're trying to record a sales tax only transaction. I know that imported goods sometimes fall under these circumstances where they're charged the sales tax amount only at the border and it can be tricky to figure out how to record it when you're not sure. Don't worry, I'll show you how.

Select Enter Bills from the Home window.
Make sure the Expenses tab is selected.
Choose an expense account related to imported goods from the Accounts drop-down.
Enter 0.01 in the Amount column.
Select the tax code that represents all taxes paid. (In this case, you'll want an HST code.)
On a second line, choose the same account as before from the Accounts drop-down.
Enter -0.01 in the Amount column.
Select the same tax code again.
Edit the amount in the sales tax field to match the sales tax charged at customs.
Select Save & Close to save the transaction.

Give it a shot! Note that you'll have to create a vendor for customs in order to be able to save the transaction, but you should be good to go with this formula. Make sure to go to the Pay Bills feature to complete the recording of this expense payment as well.

I'm here if you have further questions. Have a great day!

V

v_wakonig

I understand how you can edit the tax but I don't see the tax amount to edit. Only shows total amount. Therefore I am unable to edit HST for Customs.

L

LauraAB

Level 8

Welcome to this thread, v_wakonig,

I'm glad to see that you've found this thread to work through entering the sales tax paid at customs in QuickBooks Desktop. I want to make sure that you're able to use these steps so that you can be on your way with recording other entries into your books, and I'd be happy to help with this.

With a few more details about what you mean and perhaps even a visual of what you're seeing, I'm confident I can help you get back on track. When you add sales tax to your forms, the program should populate a sales tax section in your subtotal where you can make the changes you need to the sales tax calculation. This is what it should look like.

With what you describe, it sounds like you may have the setting toggled to show only sales tax totals. With this, you should still be able to edit the amount in the total field, but you can double check on this to see if it make a difference with the trouble you're running in to with recording this type of transaction. Here's how to change that toggle.

Select Edit from the top menu.
Choose Preferences.
Click Sales tax from the left menu.
Select the Company preferences tab.
Uncheck the box Only display tax total on transactions.
Click OK to save.

The program will close out all the windows when you do this, so make sure any unfinished work is saved first if it needs to be. After it's changed that setting, you can then go back to try to create the transaction again.

If you happen to be using QuickBooks Online instead, the process requires a minor change to what I mentioned in my original response here. While in my steps in the first response I noted that you can use the same sales tax code for each line. In QuickBooks Online, if you do this, it removes the option of being able to edit the sales tax figure. Instead, you'll want to use a different sales tax code, such as Out of Scope, as suggested in our How to record a sales tax expense on imported goods article.

That being said to, I recommend connecting with an accountant to determine which sales tax codes you should be using if you're not sure. For QuickBooks Desktop, you can use the Find an Accountant website to see the database of QuickBooks-savvy accountants near you. For QuickBooks Online, use the My Accountant tab to connect with your accountant by inviting them as a user via the email invite field or use the Find a pro to help button to see the database I just mentioned.

If you're still having trouble, feel free to elaborate in a response and share screenshots. I recommend sharing any screenshots or images you have by inserting them in the body of your message, which you can do by selecting the image icon in the menu bar above the textbox.

Wishing you the best!

LeithG

Level 2

Hi Dan

I generally enter these as a journal entry; debit directly the HST payable account and specify line 106 for an input tax credit, and credit either cash or accounts payable as applicable (being sure to specify the supplier eg Canada Customs, FedEx, whoever).

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