Medical Practice Mixed Invoicing

Avis Louth

Can anyone working with a Health Practice help me.

Client consults from a room at Chiro Practice

Fees are collected and held on her behalf,

I am then to Invoice the practice for the full fees (GST Free) less admin/room costs which are plus GST

It works like

3000 full fee

-1500 + 150 GST is for Chiro admin/room

1450 is then total of Inv for Chiro to pay my on to my client

This is all on same Invoice, which then gives me a negative gst amount on my Tax Report.

Is this normal, their accountant has asked for it to be done this way??

Acctd4

No, income & expenses have different tax codes & shouldn't be on the same form.

 I would be using a specifically set up clearing (bank) account to receive the invoiced full fees into (via Receive Payment) then from that creating a Write Chq to "pay" out the Admin/Room costs. 

This leaves the net balance (equalling the chiro's actual payment) for which I would then enter another Write Chq from that clearing account, posting directly to the relevant bank account it was paid in to - No Tax code on that one! (You could use the Transfer feature for that, I just prefer a Chq as it allows for more detail😊)

The clearing account should always be cleared to $ 0.00 each time. 

This ensures:

• the full amount of income is being declared
• the full amount of expenses are being claimed
• the GST is correctly accounted for!