Income Tax

Jay GarlandJay Garland Member Posts: 151
edited September 2018 in Accounts Hosted

I'm a sole trader (not a company) and have a TAX PAYABLE account set-up as an OTHER CURRENT LIBALIBITY. I'm assuming this manages GST only and when I manage tax and use PAY TAX or RECEIVE TAX REFUND, then I'm handling GST.

How is income tax handled in Reckon? My example chart of accounts has a DRAWINGS INCOME TAX listed as an equity account and I'm not sure what this is for. How do you track the T7 provisional tax listed on the BAS?

When I pay annual income tax or receive an income tax refund, how is it recorded?

I'm assuming the MANAGE TAX button is only for managing GST though I may be wrong. Where can I get some guidance around this?

Comments

  • Nathan ElcoateNathan Elcoate Member Posts: 359
    edited July 2017
    Hi Jay,

    Yes that's correct, all that you have mentioned is based around and for, GST tracking, payments and refunds.

    Regarding your income tax, only your Tax Accountant can calculate this for you.

    Basically without giving tax advice, use your Drawings account (Equity), for any personal expenses, then this can assist your Accountant at year end to calculate your Income Tax.

    Regards

    Nathan
  • Jacqui AllenJacqui Allen Member Posts: 242
    edited July 2017
    I presume you are a Sole Trader if so allocate Annual Income Tax paid/refunded to the Drawings Income Tax equity account.
  • Jay GarlandJay Garland Member Posts: 151
    edited November 2017
    That's what I'd been doing. Many thanks. I'm assuming that includes putting the T7 provisional tax in the drawings equity account as well?
Sign In or Register to comment.