How should I correctly log Digital Services Tax (DST) in Quickbooks Online?

SarHick18 · ‎April 24, 2022

We use Google Ads for marketing, and the invoice is 0% VAT but has a 2% Digital Services Tax (DST) Fee. Do I need to allow for the DST as VAT, if so what VAT code do I use, or does is it classed as an expense, in which case how do I set up the correct category for it?

paul72 · ‎April 26, 2022

Hi @SarHick18

DST is non-reclaimable so just enter in the same category/account as the Ads cost.

In fact, unless you want to separate out, there's no need to add it as a new line. Simply roll it into the Ads cost.

It's actually rather underhand of Goggle. The tax is meant to be a tax on their revenue; to prevent them from ~~evading~~ (sorry, that should be) avoiding, UK tax. Instead of paying that 2% they have simply increased their prices by 2% but calling it DST shifts the blame to UK Gov.

Hope this helps.

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LeizylM · ‎April 24, 2022

Welcome to Community, SarHick18.

I'm here to share some information about Digital Services Tax (DST) in QuickBooks Online.

With this, I'd recommend contacting your State Tax Agency or consulting your accountant in choosing the category to ensure accuracy and compliance.

I'll be here if you have further questions about taxes. Don't hesitate to tag my name in the comment section below. Have a great day!

paul72 · ‎April 26, 2022

Hi @SarHick18

DST is non-reclaimable so just enter in the same category/account as the Ads cost.

In fact, unless you want to separate out, there's no need to add it as a new line. Simply roll it into the Ads cost.

It's actually rather underhand of Goggle. The tax is meant to be a tax on their revenue; to prevent them from ~~evading~~ (sorry, that should be) avoiding, UK tax. Instead of paying that 2% they have simply increased their prices by 2% but calling it DST shifts the blame to UK Gov.

Hope this helps.

SarHick18 · ‎April 27, 2022

Thank you @paul72 , that's really helpful :)

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How should I correctly log Digital Services Tax (DST) in Quickbooks Online?