Can anyone please explain what the difference/s are between “GST Free” and “No Tax” ?
The reason for asking is that when I import goods from the UK, there is no GST charged by the supplier but of course, I do cop a bill from customs (via Fedex) for the Electronic Entry and the GST.
Hopefully, I have been doing things the right way by following these steps but would of course appreciate any advice or comments if it should be done differently.
- Goods are received with an invoice from supplier and payment is made.
- Purchase Invoice is raised showing items and item costs using “GST Free” as the Tax Code.
- Customs (Fedex) is received showing costs for the Electronic Entry and GST Reimbursed.
- New Bank Transaction (Spend Money) is created for Fedex showing the Electronic Entry Fee as being
“GST Free” and the GST Reimbursed figure as “GST on Imports”.
The main reason for my question is that I always have trouble (in my simple little mind) with working out whether or not my GST Report is correct as I can never get my head around the figures that show up in items G10 through to G20.
I am also running my accounts on a Cash Basis and I’m sure that I was told, at one stage, that using Cash instead of Accrual can (or does) make it difficult (or virtually impossible) to double check the tax figures against the month’s transactions.
As always, thanks for all of your help and advice.