Help with tax codes

  • 3
  • Question
  • Updated 4 years ago
  • Answered

Hi folks. I have used Quickbooks before but several years ago so I have a general idea of

my around it.I am using the trial version of ReckonAccounts Accounting: Small Business Edition 2013


The tax codes are doing my head in though and I cant afford to get someone in to do it for me (I live a long away from most places) so I am hoping I can get some help here.


First up some of the items I sell , I buy gst free (Herbs and spices)

Some items I buy have gst. (Packaging etc)


Are these capitol aqu or non capitol aqu ? What is the difference (in basic)


Obviously items bought in go in Cost of Goods Sold (I think)


Items I sell – do I still have to charge GST on sold item that I buy gst Free ?


What income account do I use for sold items. I remember I used to use 'Sales' but its not on the list? Im thinking invetory asset ?? Is that right ?


Pretty sure I can work the rest out but these are doing my head in .


I was going to use a lower version of quickbooks but I need to be able 'assemble' items I sell as they have several components to them


Thanks in advance for any help


Dean



Photo of Dean

Dean

  • 150 Points 100 badge 2x thumb

Posted 6 years ago

  • 3
Photo of SusanR

SusanR, Accredited Partner

  • 1,938 Points 1k badge 2x thumb
Hi Dean,

Please read this response in context with Australian GST laws.

Reckon Accounts uses Tax Codes to identify the GST status on income and expenses and to report accurately.

In Accounts, the usual code for selling something that has GST is 'GST'.  The usual code for selling GST free items is 'FRE'.

Purchases are usually classified as either Capital Acquisition or Non-Capital purchases, and need to be coded as such because they report in different labels on the activity statement.  Capital Acquisition tax codes begin with 'CA' and Non-Capital tax codes begin with 'NC'.

In both CA and NC transactions, if the purchase includes GST then add a 'G' to the end, eg CAG and NCG.  Likewise if the purchase is GST free, add a 'F' to the end, eg CAG and CAF.

There are other tax codes that might be useful for your business and you should speak to your accountant about this.  Also you should speak to your accountant as to which accounts you should post your income and expenses to.  If they are not in the chart of accounts, they can easily be added.

Your accountant can also help you with your queries about whether you should be charging GST on things that you haven't paid GST.  There are many differentiating situations.

Inventory Asset is not an income account, and shouldn't be used to record Sales.  It is a current asset that shows in the Balance Sheet report.  Sales is an income account that shows in the Profit and Loss report.

Since the GST was introduced in 2000, the software has used the same tax codes, and also the same tax codes across all versions.

You might find this link useful http://www.ato.gov.au/Business/Bus/GST-for-small-business/

I hope this helps.

Sue


Photo of Dean

Dean

  • 150 Points 100 badge 2x thumb
Hi Sue . Thanks for the excellent reply. I think I need to rethink using this software as it is just way to complicated with all these codes.and getting an accountant in to set it up is just not going to happen with the prices they charge and the closest one being 400km away.

Thanks for your time .
Photo of SusanR

SusanR, Accredited Partner

  • 1,938 Points 1k badge 2x thumb
Please replace paragraph 5 in my response:

*** In both CA and NC transactions, if the purchase includes GST then add a 'G' to the end, eg CAG and NCG.  Likewise if the purchase is GST free, add a 'F' to the end, eg CAF and NCF. ***

Regards, Sue
WAS DOES THE TAX CODE NCF STAND FOR IN RECKON
What does the NCF tax does stand for in Reckon
Photo of Zoe Rickard

Zoe Rickard, Accredited Partner

  • 1,430 Points 1k badge 2x thumb
Hi Beaufort 24HR Chemist, 

The NCF tax code refers to Non Capital purchases that are GST Free. 

I hope this information assists you.  

Zoe

e: zoe@calculation.com.au
Photo of SusanR

SusanR, Accredited Partner

  • 1,938 Points 1k badge 2x thumb
Hi Dean,

Have you looked at the Find A Reckon Accredited Partner Page?

Here is the link.
http://home.reckon.com.au/support/Home/ReckonSupport/FindAReckonAccreditedPartner.aspx

These Partners are experts in the Reckon Accounts Software and most offer remote support.  You could find somebody who could quickly set up your file and give you some instruction.

I think that you might find this a more affordable option than you think, and with a personal touch.  Most Partners are quite happy to quote first.

Another option is to do some short online training. 

Here is the link.
http://training.reckon.com.au/

And of course there is this community - with hundreds of people ready and eager to help you.

Finally, a little hint:  Did you know that you can add default tax codes to your accounts so that the tax codes populate automatically when you select the account?

I hope you find these suggestions helpful.

Sue

(Edited)
Photo of Ann-Marie

Ann-Marie

  • 82 Points 75 badge 2x thumb
This reply was created from a merged topic originally titled
Export Tax Code. Can any help with setting up an export code in Accounts Hosted..


Export Tax Code

This conversation is no longer open for comments or replies.