Managing Sales Tax in QuickBooks – Part Two

Posted by on Feb 14, 2011 in Sales Tax | 0 comments

We are to going to add the provincial sales tax for a different province. This has become necessary for our sample BC company because an office was opened in Calgary, Alberta, where services will be provided.

In order to set this up we need to create a tax code, so go to List, Sales Tax Code List, right click your mouse and choose New. In the following fields add this information: Sales Tax Code – AB, Description –  GST (AB) Only, click on the Taxable button, and tab to the Tax Items for Purchases field.

You will have to set up a new item for the Purchases and Sales. From the New Item screen add this information in the following fields: Type – Sales Tax Item, Sales Tax Name – AB Purchases, Description – Alberta Purchases, Tax Rate % or Amount – 5.0%, Tax Agency – Receiver General, Sales Tax Return Line – choose Line 106 Input Tax Credits (ITC) and OK.

Now move down to the Tax Item for Sales and perform the same steps except change the Sales Tax Name to AB Sales, Description to Alberta Sales, use 5% for Tax Rate, Receiver General for Tax Agency and on the Sales Tax Return Line – Line 103 GST/HST collected or collectible and OK.  You now will have Alberta Sales Tax Codes for Sales and Purchases.  

You can have a look at these by going to your Home page, Manage Sales Tax icon in the Vendor section.

As you can see in this screen, you have four sections: Tax accounts and payments, Tax codes and rates, Sales tax adjustments and Sales tax setup. You also have three tabs: Adjust Tax Owing, Change Tax Setup and Assign Tax Codes.

In the Sales Tax Codes section you will see your AB (Alberta) code, and if you highlight it all the pertinent information appears in the Sales Tax Items and Purchase Tax Items section.  

As in the previous segment I would suggest that you get help with any of the three tabs from your QuickBooks Trainer or ProAdvisor.

The next segment will be on Filing your Sales Tax.

Remember that you can follow me on Twitter @twitter.com/QuikBooksTrainr for tips and updates also.

www.quickbookstrained.com is now mobile friendly. From the web address you can choose Options/Mobile formatted and the site will appear in all its living colour for you to view. Check it out.

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