Tax code Exception Report

Question

Hi , I am hoping someone can help me. I'm new with Reckon hosted. we have a credit card that we use to pay bills with. The bank automatically takes out the amount of the credit card from our bank account.   I reconcile the credit card and then write out a cheque for the amount. But now the payments I have been making from the bank are coming up on the Tax Code Exception Report. I don't know how to fix this.  Please help.

Narelle_6584264 · Accepted Answer

Yes thank you. So the cheque does not get coded?

Kris_Williams · Accepted Answer

No, because you’ve already coded the individual credit card expenses - correct?

Acctd4 · Accepted Answer

@Narelle

Yes, I agree with Kris - You should have all the expenses already entered with applicable tax codes.

The credit card payment is simply a movement of funds from your bank account to your credit card account (like a loan repayment)   The credit card balance is not an expense, but a liability (eg that you owe) - The taxable transaction is the goods or services actually purchased.

The Tax Code Exception Report is a good way to check you haven't forgotten to code something that should be!  In this scenario, the repayment should definitely NOT be coded (if you've entered the Bills/Receipts/ Credit Card Charge transactions) 😊