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This Qtr's BAS amount payable to ATO is less than the PAYG withholding. Usually I would make 2 transactions - Pay PAYG in the" Create Custom Liability Payment" and BAS payment, in the manage tax window (total amount payable minus PAYG) How can I record the transaction if the total BAS payment is less than the PAYG?
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Posted 1 year ago

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Kerrie H

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Hi Kelly,

I process a cheque for the total amount payable to the ATO using a created "other current liability" account for processing the payment (ATO intergrated client account), then process a journal as follows; 
Your tax payable will be a credit rather than a debit as shown, which will balance out at the totals at the bottom of the journal.  The provision for income tax is only used if you are paying a tax installment.
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Thanks Kerrie
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John G, Information Support Analyst

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Hello Kelly,

You can do the process much as you have done before, but use a "Bank Clearing Account" to produce the one payment in your normal bank account.

1.  Process the PAYGW component through Employees > Process Payroll Liabilities >Pay payroll Liabilities, and choose your Bank clearing Account for the source of funds.

2.  Process the GST refund component through Suppliers > Tax Activity > Manage Tax > Receive Tax Refund, and accept the funds to the Bank Clearing Account.

3. Transfer funds from your normal bank account to the bank clearing account to reduce its balance to zero.

4  Pay the ATO in your normal manner.  

You will have one payment in your bank account for your PAYGW less your other BAS component refunds, and your Liabilities and Tax registers will be properly adjusted for the generation of relevant Reports.

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Thanks John