I hope someone could help on following issue :
I imported goods from USA factory , payment term is advance prior to shipment via T/T , freight /handling and GST import charge is via our FedEx account .
I am not sure how to post GST import in this case . one is payment for
USA factory , another is FedEx locally payment for GST import 7% for this goods .
This is an extract from another topic: (edited)
This is how it works when you end up paying GST Tax separate from USA factory invoice:
When you record the USA factory invoice, record it as you would record any other purchase invoice. Use tax code GST TAX FREE because USA factory is not charging you GST.
Then the GST charge comes via FedEx. Let’s say the USA factory invoice was 10,000 (as recorded above) and the GST via FedEx comes in at $1,400 (14%)
You need to enter this $1,400 in following way on the FedEx invoice:
(Minus) -10,000 with tax code: GST TAX FREE
(Positive) 11,400 with tax code: GST 14% (being inclusive)
This split reverses the original VAT free purchase (-10,000) and records a new purchase with VAT 14% code ($11,400). Now the Tax Summary will show correct purchases
There is another, simpler way to do this, @rich.
Enter the bill you receive from the USA factory as a purchase invoice in Manager. Leave the tax code blank, because no tax is involved in this transaction. (The purchase is also not technically GST free. The GST is paid to someone other than the supplier. GST-free tax codes are generally reserved for items that are exempted from tax by law.)
Create a Pass-through (100%) custom tax code as described in this Guide: Create and use tax codes | Manager in the section on custom tax codes. Quoting from the Guide,
“Choose Pass-through (100%) to create a tax code for line items that are all tax. A common application is when a tax authority sends a bill for tax due on imported goods; the tax is paid to the tax authority instead of the supplier who sold you the goods. Forms will show the tax amount as a regular line item. The tax amount will be included in the subtotal rather than showing below the subtotal as an amount to be added. The entire tax amount will post to the designated tax liability account.”
In your case, the tax bill is sent by FedEx rather than a tax authority. You will only need to do this once. You will use this tax code for all your future imports for which you are billed separately, regardless of percentage of purchase cost or who sends the bill.
When you receive the bill from FedEx, enter it as a normal purchase invoice with line items for transportation charges, brokerage fees, and any other charges on the bill except the tax on the purchase from the USA factory. Post these to appropriate expense accounts. If these charges are subject to tax, apply regular tax codes to them according to the applicable percentages.
Add a final line item to the FedEx purchase invoice for the amount of tax on the purchase from the USA factory. Put the tax amount in the Unit price field. On this line only, apply the Pass-through (100%) tax code you created in #2 above. All of the amount entered will be posted to the tax liability account designated when you set up the tax code.
In summary, you will have two purchase invoices: one for the USA supplier and one for FedEx. You will have no negative entries, and nothing will be reversed. This is exactly the situation pass-through tax codes were created to handle.
Firstly, you can not LEGALLY leave the tax code blank because the goods being purchased are NOT TAX EXEMPT, they are only Tax Free (Zero rated) until the Tax is later charged.
Yes it is under the GST ACT. Furthermore, the GST status of the transaction is determined by the GST ACT, not by the supplier. Besides, leaving the tax code blank would also mean the transaction gets excluded from tax reporting, whereas the purchase is a reportable tax transaction.
This WONT work for a GST situation as the custom (self) created 100% tax code will be excluded from the in-built BAS Statement reporting - which only functions with the in-built tax codes.
Which is only applicable where Manager doesn’t have an inbuilt tax reporting for a country.
Therefore the suggested method wont work for England, Netherlands, Australia etc