COVID 19 Cash boost entries
LindsayCampbell
Member Posts: 8 ✭
Hi , We have received the initial Cash boost from the ATO in the form of Tax credit against our integrated tax account on the ATO business portal. For sake of exercise, lets say it is $20000 credit. What are the DR and CR entries in Reckon people are applying ? According to ATO, the amount received is TAX FREE and not Assessable income. I'm assuming the DR will be against the TAX Liability (GST) account and the CR will need to be some form of account that doesn't apply GST as well as report the amount into the Profit & Loss account. Anyone with a suggestion on how to set up that type of account please ?
2
Comments
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I have set up an account called 'Cash Flow Boost (non taxable)' as an Other Income type account.
If actual refund from ATO (say $10,500 refund - if monthly Jan ($8k) and Feb ($8k) already paid and March unpaid) could be split as follows:
Deposit screen - 1st line CashFB account $24,000 (Jan and Feb refund and March payable/unpaid), 2nd line PAYGW negative/debit $8,000 (March unpaid to reduce liability) 3rd line GST Payable negative $5,500 (being March qtr GST)…...or similar depending on circumstances
If no refund, but reduced payable, (say only the GST of $5,500) then the payment is recorded as:
Out of bank $5,500 to GST Payable, plus 2nd line debit to PAYGW $8,000 and credit on 3rd line to CashFBoost account $8,000......or whatever needs to be done to make sure CashFBoost total equals the quarterly PAYGW
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I'm going to be setting up an income account for all these reimbursements, payroll tax, PAYGW etc. so I will credit this account and debit the liability if the funds are a credit. If they are received in the bank then the money can just be allocated to the income account.0
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thanks Teagan - makes sense but you don't want to be including the reimbursement amounts you are calling income into your P&L reports I wouldn't have thought.0
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