Tax Only Account

SynergyK9

I tried searching this question before posting but came up empty.
I am curious if anyone knows the best way to create a "tax only" account, or how to record this correctly.
Purpose: I am in Canada and import inventory from the US and overseas. When the items clear Canada customs, we are charged HST on the value of the goods. This amount shows on my invoice a separate line item from the Freight Fowarder/Customs Broker. I want to make sure that the amount is recorded correctly in my Sales Tax Liabilities Account.

Thanks!

KiahD

Hi @SynergyK9! In short, you're already tracking your HST correctly!

When you create a Sales Tax, either on the Chart of Accounts, or from the invoice, bill or transaction itself, it creates a new "tax only" account for use on your Chart of Accounts.

When you add this Sales Tax to an invoice, bill or transaction, it creates a separate line item, which tracks the funds in the selected Sales Tax Liability account, e.g. HST. You can then view your sales taxes on the Reports > Sales Tax Report, or the Account Transactions Report.

Check out this Help Centre Article for more info: https://support.waveapps.com/hc/en-us/articles/360039628292-How-sales-tax-works-in-Wave !

Kimpton

As KiahD notes you can just use your GST account to record this amount if it's a normal transaction. CRA only requires a total HST/GST amount.
If you are in a province that does not have a provincial sales tax or is not harmonised with GST, then add another Sales tax account called HST/GST in your Settings page. Select the HST rate of the province importing.
If the broker invoice charges GST/HST for an amount different than the total cost of the billing then you can override the tax calculation.