Commissions And GST Bookkeeping Question

GST

Should there be GST on Commission payments made to third party agents?

Goods Service Tax

by Jenny
(British Columbia, Canada)

I am not registered for a GST #. I am not collecting GST. When I am entering bills that have GST on them what account do I use for the GST. What is the name of it?

Hello Jenny,

Thank you for your question.

I believe you can just lump the GST into whatever it is that was invoiced. Otherwise if you would like to separately categorize it, you would probably use a Tax Expense or Taxes Paid account.

HST/GST Rebate for a registered Canadian charity

by Ralph
(Nova Scotia)

OK here's the problem: I am trying to close off the fiscal year ending March 31, 2009. Four years ago, we registered a small Canadian charity. I took a short course on Simply Accounting. I've learned that as a charity we can apply for a rebate of 50% of money we have spent on HST/GST in the past fiscal year and indeed, can also apply to get the same 50% rebate for the previous 3 years. (In total= 50% of all goods & setvices tax paid in the 4 year period). In Simply Accounting HST/GST appears as a debit to Account #2260 HST/GST paid on Purchases. (Not to Account #5125 HST/GST Expense).

To try to keep this simple, let us say we paid $500 HST/GST each year for the four years. Thus the debit balance in Account #2260 HST/GST paid on Purchases is now $2000 and the balance in Account #5125 HST/GST Expense has always been nil.

I believe entries for $500 this past year should be: Debit revenue Account #4240 CCRA - HST/GST Rebate $250 Debit Account #5125 HST/GST Expense $250
Credit Account #2260 HST/GST paid on Purchases $500

But how do I properly account for the $750 rebate from the 3 previous years without mis-stating my books? Revenue of $750 I suppose can be considered in the year it is received but the $1500 sales tax paid on purchases all relates to prior periods. And, when I start the new period, I'd like to have a zero balance in that account #2260

Term discount on G.S.T.

by Lyn Perry
(Toronto, On, Canada)

Terms of 1%/10. Is the 1% to be taken on the whole invoice amount including G.S.T. or does the discount only apply to the product and customer has to pay the total G.S.T. amount charged?

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