TPAR and prepaid deposits
Need help explaining how to approach the following scenario so that it works with the TPAR!
Sometimes we have to pay a deposit to our Taxable Payments contractors to lock them in for a job. They don't issue an invoice for this deposit; the invoice is only issued once the work is complete.
Say for example we need to pay a $4,000 deposit on an $11,000 contract. The method I've been following to do this is:
- Write a cheque to the Supplier for the deposit amount; say for example $4000. Put this to "Accounts Payable", and list the supplier's name in the Customer:Job column. No GST is recorded as part of this deposit because we do not have a tax invoice yet.
- Enter the bill as normal when the work is complete and the invoice is received for the full amount: say $10,000 net plus $1,000 GST.
- Pay the bill via the Pay Bills screen. There is a $4,000 credit available which is applied against the bill, leaving $7,000 to pay.
This worked well I thought. The GST was all accounted for properly (we're on accrual system for GST), the bill recognised as fully paid.
But now when I am preparing the TPAR, I realise that because the TPAR is on a CASH basis, it doesn't recognise the GST as being fully paid for these transactions. Using the above example, it is reporting that I have paid $11,000 gross but only recognising GST of $636.36 being paid ($7,000 / 11); not the full $1,000.
So clearly my system doesn't work (for TPAR suppliers at least).
How else could I enter these deposits so that the GST is reported correctly on the TPAR? Or once I receive the bill, do I have to go back and change the initial deposit transaction so that it is a direct Bill Payment instead? (Which might not matter if it is all within the one BAS reporting period, but is probably not correct if they are in different periods; GST will be incorrectly reported and/or claimed).
Or do I need to hack into the TPAR file before I lodge it with the ATO and manually change the tax figure for those suppliers (no idea if this will crash the file or not!)
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