To assist reporting input-taxed purchases on your Business Activity Statement (BAS), you can allocate an "Input-Taxed" (INP) tax code to those transactions. The default tax code (which might already exist in your company file) is set up as shown in the following example. Image RemovedImage Added Unlike all other tax code types, "Input Taxed" tax type codes do not need to be linked to tax collected and tax paid accounts as shown in the following example. If you enter input-taxed purchases as tax exclusive, set the Rate at 10%. If you enter input-taxed purchases as tax inclusive, set the Rate at 0%. When you use this tax code for an input-taxed item, no amount will be allocated to the GST liability account. The full amount will be allocated to the expense account specified at the time of recording the purchase. When you run GST reports, any amounts that have been allocated to the INP tax code and are listed in the Purchase Value and Tax Paid columns, need to be added together and reported at G13 on the BAS. |