Ok so my client has deregistered for GST
Whats the easiest way to change in manager I have
Made all the tax codes inactive will that sufice to stop adding GST or do I need to go through all the accounts in the chart of accounts and remove GST rate
find & recode to remove tax codes for transactions dated after the client de-registered. Leave tax codes on transaction when the client was registered for GST
Yes Patch I have done that but was moving forward do I just make tax codes inactive or do I remove tax codes from the accounts I n the chart of accounts
Do not remove the tax codes. That would retroactively change every past transaction where they were used and all the past financial statements.
Oh thank you Tut, that’s what I have done hopefully when I reinstate them it returns back to normal.
If thats the case then I have to go through the chart of accounts and take off the GST portion then?
You might also need to make an adjustment for assets retained after cancelling GST registration.
Yes Tony I have already. just wanted to know how to stop the GST with out going through each account in chart of accounts. in Xero you tick a box and say from this date forward and it no longer does the GST
@Wornout, I am not sure what you are saying you did. Did you delete the tax codes? You could not have done that while there were transactions to which they had been applied without first removing the tax codes from those transactions. If you did that, then recreated the tax codes, that would not reapply them to the transactions. The program would treat them as completely new tax codes, even if you gave them the same names.
Or are you saying you have removed default tax codes from individual accounts in the chart of accounts? Doing that would have no impact on existing transactions. It would only prevent the tax codes from being automatically applied when transactions were posted to the affected accounts. In that case, what do you mean by “reinstate?” If you mean redefining the accounts to incorporate a default tax code, that will put you right back where you already were, with codes being automatically applied on new transactions.
In all this, understand that there is a big difference between deleting the tax code itself and removing it from an account definition. Including it in the account definition in the first place is only a shortcut, so you don’t always have to manually apply the code on every transaction line. That does nothing to the tax code itself.
@Wornout you can make the tax codes inactive once you cancel GST registration but will also need to change the default GST code from each account in the chart of accounts to No Tax to avoid incorrectly allocating GST to future transactions.