Insurance Claim
Our business has had to pay $1232.00 inc GST to one of our customers for property damage to their ceiling. They have provided our business with a tax invoice which I have paid. What GL code do I expense this to? Should it be repairs and maintenance or should I create an Insurance Claim code?
We have also received the refund from our insurer of $620 which is $1232 less $500 excess and $112 in GST. Do I need to create an expense account for the exess portion ($500) and an income account for the total of the claim less GST ($1120)? If so what should the GL codes be called so our accountant can follow what I've done.
Thanks for your response. I have coded the purchase to the insurance gl expense code and I'm aware this includes GST. This was processed as an invoice from our customer and not as spend money. In my research for an answer I found one site that suggested coding the purchase to repairs hence my confusion. I will leave as is.
With regards to the refund from our insurer there is no GST in the refund? Amount claimed is $1232.00 and 100% is ITC. The ITC deducted amount is therfore $112 less excess of $500 = refund amount of $620.00. In recieve money I should enter the refund amount as $620 but shouldn't I put a debit amount of $1120 GST Free and a credit amount of $500 GST Free?
Please advise further.
