Business car trade in discount
Hi there - I have taken over the books from a previous bookkeeper so still new to Reckon Hosted. I have written a cheque to a supplier to pay for a company vehicle. The invoice total included the vehicle, rego, CTP, and a trade in discount. When entering into reckon hosted, I put each line item within the cheque and the discount as a minus figure, do not to disturb the GST payable on the vehicle.
Now when doing my BAS its showing in my tax summary report, it's showing the discount again as a minus figure on my tax summary report under the Net FRE-P column (in red).
Just checking whether this is right or whether I should have entered this differently?
Answers
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Hi @FarlowGroup
Reckon Accounts/Hosted uses different forms & tax codes for income v expenditure. This is how it identifies where the figures should appear on the tax reports/BAS. Income lines shouldn't be on a purchase transaction & vice versa.
The trade-in should be on a Sales Receipt with an income-type tax code eg "GST". Check the documentation as if purchased from a car dealership, there will usually be a GST component (in which case it won't be "FRE")
You can use a Clearing bank account to offset the (full) payment against the trade-in by paying the Chq out of there & depositing the Sales Receipt back to there. Then transfer the balance (either via Transfer Funds or another Cheque)
😊
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Hi Shaz, I tried this but now the full cost of the vehicle purchase is showing under the GST-P column of my tax summary. I entered the vehicle purchase as a bill so I could split out line items between the vehcile body cost vs stamp duty, etc with different tax codes. Currently the purchase of the body is logged under GST code.
Is this because I've created an item under 'fixed asset' vs expense? Should I create an expense account?
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Hi @FarlowGroup
No, it's because you need to use separate tax codes for purchases/expenses v sales/income.
I've written-up & attached a quick summary on this for you 😊
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