none
Money 2006 business edition - proper use of account receivables after paying collected sales tax RRS feed

  • Question

  • When I enter an invoice and sales tax is collected, money shows the amount of the sales tax as a liability in business reports. I get paid for the invoice, and enter it as "receive payment for invoice.", into accounts receivable.  That also includes the sales tax, but I'm not recognizing how money is entered so the program doesn't continue to see that tax as a liability after  I have paid the sales tax to the tax board.  What category or proper entry should I be making when I pay out the collected sales tax so that money recognizes that it is no longer a liability?   Thank you for any suggestion .

    Niki

    Thursday, March 29, 2018 6:35 AM

Answers

  • Per the Help page "See how much sales tax you have collected", you need to transfer from Sales Tax to the appropriate government body that collects the tax.  This subtracts from the liability account.

    " To remind yourself to pay sales tax when it is due, you can schedule a bill. Make sure to schedule it as a transfer."


    • Edited by ameridan Thursday, March 29, 2018 10:18 PM
    • Marked as answer by johnniki Wednesday, April 4, 2018 1:41 AM
    Thursday, March 29, 2018 10:15 PM

All replies

  • Per the Help page "See how much sales tax you have collected", you need to transfer from Sales Tax to the appropriate government body that collects the tax.  This subtracts from the liability account.

    " To remind yourself to pay sales tax when it is due, you can schedule a bill. Make sure to schedule it as a transfer."


    • Edited by ameridan Thursday, March 29, 2018 10:18 PM
    • Marked as answer by johnniki Wednesday, April 4, 2018 1:41 AM
    Thursday, March 29, 2018 10:15 PM
  • So, I went to the transaction where I paid the state for the collected tax, changed the transaction to a transfer, and found a category Sales Tax, which I chose.  That did indeed move the amount off of liability.  I still have to figure how to balance the "use tax" which I pay on items removed from inventory for personal use.  Perhaps I need to enter the products as taxable so maybe a sales tax entry will go  to liability when the item is removed for personal use.  I am still having a balance, negative, in the liability because no balancing entry exists for the use tax which is paid in conjunction with my sales tax payments.  But happy to see where i can balance that sales tax with the payment.  Thank you, just a bit more tweaking and this should become zero.

    Thank you, Niki


    • Edited by johnniki Wednesday, April 4, 2018 1:49 AM
    Wednesday, April 4, 2018 1:49 AM
  • "Use tax" is tax on a sale to yourself, usually at cost price. It should be posted to the same account as the liability on sales to customers.

    When you pay the tax to your state the amount paid should be posted to the liability account. You should then be able to reconcile the liability account in Money to show that the balance is the tax due on sales made - to customers and yourself - not yet paid over.

    Wednesday, April 4, 2018 8:22 AM