GST adjustments in Essentials
Hi folks,
Forgive me if this has been asked before. If so, could someone please point me to the answer, thanks.
I'm trying to work out how to make some GST adjustments around the purchase of a company car. My accountant has given me some advice but doesn't know myob so can't tell me the specifics.
Here's the issue:
Exisiting company car traded for a new car. Trade in value $12k
New car cost $23k.
The balance ($11k) is on finance.
My accountant says "Add the GST on the sale of the old car to the GST on students fees, and add the GST on the purchase of the new car to the GST on expenses. " ("Student fees" is our primary income source).
Can anyone help me understand how to do this in Essentials?
(There's also a secondary issue that we've claimed GST on the finance payments, which we now understand is not correct in NZ tax requirements. Is there an easy solution to sort this? )
Really appreciate any guidance with this. Thanks
Mark
Hi MMM-NZ Mark,
First of all you need to create a loan account for the loan balance in your chart of accounts.
Then do a spend money transaction adding 4 lines.
1st line - purchase of new vehicle inc GST
2nd line - less trade in value in a negative amount
3rd line - add the cost of PPSR and any application fee
4th Line - balance goes off to loan account created.
Amount comes back to NIL transaction total - unless you paid a deposit
With the second issue - you need to again to do a NIL value spend money transaction - coding to total payments made with no GST, and then a second line with the same value in negative with the same amount inc GST. This will pay back the GST you have claimed incorrectly.
Using a spend money transactions makes sure that this transaction is included on the payment basis for GST - which I'm assuming you are on.
Hope this helps.
