Tax Credits

Hi mlawler,

In this type of issue, we do recommend reaching out to your accountant for an accurate solution. But to give you an idea, yes, you can add tax credits in MYOB to claim back GST and receive a refund from the government. When you import goods from overseas and pay for them, you account for this transaction in MYOB. Upon the arrival of the goods, you pay the GST value to the government and record this transaction in MYOB as well. You can also visit this help pages for more information: 

How To Claim GST: Goods And Services Tax Refunds
GST Reimbursements And Credits: The Complete Guide

Regards,
Earl

Hi mlawler

These MYOB Mods are overcomplicating the process.  I'd do the following.

For MYOB Business:

Step 1)  TAX CODE

Create a new Tax code under Accounting>Tax Codes and call it something along the lines of 'GST Paid on Imported Goods'.  Enter the Rate as 100%.  See attached as an example.

Step 2) SUPPLIER CONTACT

Create a Supplier Contact for the payments you make to government for GST and tag the GST Code "IMP" to this supplier contact as the default code.  If you already have a Supplier Contact, then just update the existing details.  This will ensure that you are able to see this payable on your Creditors List.

Step 3) CHART OF ACCOUNTS

Gets a little tricky from here, 

a) Set up either one or two Expense Accounts in the chart of accounts.

b) Maybe put them in the Other Expense section so it doesn't appear before your Net Operating Income Total.  

c) If one account, call it GST Paid on Imported Goods and set the default rate to 'IMP'.

d) If two accounts, call them GST Paid on Imported Goods (IMP) and GST Paid on Imported Goods (N-T)  with "IMP" and "N-T" as the respective tax codes.

Step 4) ENTRY

When entering the GST due to the Govt as a Bill, you need to enter it as two lines and set the purchase as 'Exclusive of GST'.

Say the amount is $100, the entry will be:

Line 1      GST Paid on Imported Goods (IMP)        $100         IMP

Line 2      GST Paid on Imported Goods (N-T)        -$100        N-T

See attached for an example

(NB: I just used my Rounding account as I didn't want to create new expense accounts.)

So you will have a nil effect on your expenditure, but will have created a Creditor Balance Payable along with the full allocation to GST Paid (Tax Credit).  If you go with one account, then nothing will appear on your PnL.  If you go with two, then there will be a plus & minus figure on your PnL.  Maybe put it under a Header Account with a subtotal so you know that the net balance is zero.

Check with your accountant on when this transaction should be dated if you report GST on an Accrual Basis.  It may be payable on arrival, but I would suggest that the GST may be effectively accrued when the goods are ordered. 

Hope this helps.

Cheers

Hi Earl

Thnaks for your reply.

Are you able to provide an example (screen shot) on how t claim the tax credit?

Thanks