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  #1  
Old 06-09-2002, 08:52 AM
applied applied is offline
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vendors sales tax

I have just started using quickbooks 2002 premier, for my companies accountancy solutions.I am no expert with this but am finding it very rewarding to what it has to offer, we startes to use it just to track sales made (invoices,despatch notes etc).

I decided to input all our data made so far, from the beginning of the year - including all things purchased via vendors, only this is where i became unstuck -

1, do i input items purchased/paid for as a bill or credit

2, how do i setup quickbooks to track sales tax paid, and get it to show on the final balance sheet

ive managed to setup quickbooks to track sales tax we receive - but i cant seem to get it to track sales tax weve paid out.

using the help feature didnt seem to help much either - i tried to set up a new account in "chart of accounts" as tax paid but i couldnt get this to work either.

if anyone out there could give me a solution to this i would be very grateful.

thanx steve
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Old 06-09-2002, 12:00 PM
Joey Joey is offline
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You're making it harder than it needs to be. The sales tax you pay for things are included in the price of whatever you are paying for. It's not supposed to be broken out separately. You only track the sales tax you collect on your sales so you can pay it over to your state.
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  #3  
Old 06-09-2002, 12:11 PM
Joey Joey is offline
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If you are going to be using the Enter Bills feature to enter things you purchase, then be sure to use the Pay Bills feature. If you don't need to enter bills first, then just use the Write Checks screen to enter the checks directly.
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  #4  
Old 06-09-2002, 01:27 PM
applied applied is offline
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thanx for that joey - but im from the uk and sales tax is included in the things i purchase but they are seperated.This is the vat(value added tax).I need to see them seperated so i can work out the difference between the two, hence knowing how much to pay to the government

steve
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  #5  
Old 06-09-2002, 01:47 PM
Joey Joey is offline
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Then you need to set up an expense type of account for VAT taxes and charge the tax to that account when you enter the bill (if you are using the Enter Bills feature) or split the check at the bottom if you are using Write Checks. Taxes you pay are an expense to the company and don't appear on the Balance Sheet. Do you subtract the sales tax you pay from the sales taxes you remit that you collected? If so, then charge your sales tax liability account instead of the expense account to reduce the amount of your liability. We don't have VAT tax here in Florida. If I knew more about it, I could help you more. I know how the program works, I just don't know how the VAT tax works.
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  #6  
Old 06-09-2002, 02:46 PM
PHebert PHebert is offline
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I am not familiar with your VAT TAX requirements, but here is one consideration. A very important QuickBooks constraint is that individual transactions cannot have more than one AR or AP account. Essentially, what you want to do is just that. One entry to Accounts Payable and Another to VAT TAX payable. You will have to do some sort of work around.

For example, producing an end of the month report on all invoices and then journalizing an entry to record VAT Tax expense and liability. If rates vary from invoice to invoice, setting each invoice to a class will give you the required reports to record the taxes. Worse case scenario is to do a journal entry on each invoice, which is not a pretty picture. Getting around that constraint is not easy.

I am surprised that the UK version doesn't have a mechanism to deal with VAT taxes. They are very common in Europe (and the rest of the world for that matter).
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  #7  
Old 06-10-2002, 03:51 PM
applied applied is offline
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thanx for that joey - yes we do subtract the tax we pay from the tax we submit, and that sounds a good scenario to charge the tax to our tax liability.Only thing is i am very new to this software, could you possibly give me a rundown on how you actually do that.

you sound very clued up and ill look forward to your response.

steve
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  #8  
Old 06-10-2002, 04:05 PM
Joey Joey is offline
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If you're using the Enter Bills, Pay Bills area, charge the VAT tax to an expense account when you enter the bills. Then, at month end, make a journal entry to debit your sales tax liability account and credit the expense account for the amount you have paid each month. It will show up on your Sales Tax Liability reports as a credit to the amount you owe. If you are using Write Checks, you can make a sales tax type item and charge that directly when you pay the vendors. You can't charge the liability account directly if you're using Pay Bills.
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