GST REPORTING ON A DEPOSIT

Jenny Byrne
Jenny Byrne Member Posts: 65 Reckoner Reckoner
edited February 2021 in Accounts Hosted

We have received a significant deposit for work to be commenced in April 2021. I do not want to pay the GST this quarter because we have not done any work. How do I show this in Reckon Hosted without the GST component showing in this quarters GST report

Comments

  • Kris_Williams
    Kris_Williams Member Posts: 3,937 Reckon Hall of Famer Reckon Hall of Famer

    I could be wrong but I believe the onus is on you to pay the GST on the deposit even if the work has not been started, as you have received the money

  • Jenny Byrne
    Jenny Byrne Member Posts: 65 Reckoner Reckoner

    I thought that was if we worked on a cash basis. I use the accrual system

  • Kris_Williams
    Kris_Williams Member Posts: 3,937 Reckon Hall of Famer Reckon Hall of Famer

    Either way you have received the money and have to account for it on the correct date. Wait for someone else to offer some advice to be sure

  • Jenny Byrne
    Jenny Byrne Member Posts: 65 Reckoner Reckoner

    Because it was a deposit for work yet to be done I thought I could place it somewhere else in Reckon other thatn 4200 so the gst did not show until next quarter

  • Kris_Williams
    Kris_Williams Member Posts: 3,937 Reckon Hall of Famer Reckon Hall of Famer

    You can do whatever you need to in Reckon, show it in an offset account, E.g. Contra, and then journal it out later, but that’s not to say it’s correct. Creative bookkeeping!

  • Jenny Byrne
    Jenny Byrne Member Posts: 65 Reckoner Reckoner

    Thanks Kris. Will leave it to the accountant

  • Linda ABC
    Linda ABC Accredited Partner Posts: 1,111 Accredited Partner Accredited Partner

    Kris is correct, unless the deposit is refundable if the work doesn't proceed.. if that's the case then you could create an other current liability called Deposits Received and put the payment there...

    At the point that either the work commences or the deposit becomes non refundable.. you could then raise a tax invoice to record the gst and create a payment item called Less Deposits Received and point this to the liability account created above ... this will then reduce the invoice balance by the amount of the prebipus deposit.

    Cheers Linda

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