Canadian GnuCash user

R. Victor Klassen rvklassen at gmail.com
Thu Feb 12 18:29:11 EST 2015


I’ll give you indirect answers to some of your questions, and more direct to some.

First, I have only two HST accounts in liabilities.  One I call Input Tax Credits (or ITC).  The other HST payable.   Both of these reside under the same parent account Liabilities:HST

For sales of taxable items, the tax goes to HST payable - since I eventually need to remit that.   For purchases of taxable items, the HST goes to ITC.  They go in opposite directions, so the sum is what the government owes me - in farming, it typically works that way for HST.

As for how it is entered, I will usually create an invoice - you need to set up what GnuCash calls a tax table - and then you can just check the column for what is taxable, and the rest isn’t.  GNUcash then calculates the tax and puts it in the right account [you assign that when you set up the tax table].   I did this even when producing invoices with a spreadsheet.  Then it doesn’t matter whether the GNUcash invoice looks any good.   Eventually you can set up a GNUcash invoice that looks right.

When I get paid at the same time as I create the invoice, I can “pay” it from a menu item on the invoice page.   If paid later, I can select the invoice and “pay” it from the search invoice page.   Or I can select a transaction that involves receiving the payment and go to one of the menus where “assign as payment” shows up, and then select the invoice.   This takes it out of accounts receivable automatically and puts it in the account of my choice - either into Undeposited Cheques or Petty Cash - depending.   Then when it gets deposited to the bank, it comes out of Undeposited Cheques and/or Petty Cash and goes into a bank account.

With regard to your specific query below, I would expect that “Parts Bought” + “HST Paid” [for me ITC] = the total going to Credit Card.  What you paid is the sum of the purchase price and the tax.   If the credit card is a liability account, it should be growing more “positive” when you spend.


On Feb 12, 2015, at 2:58 PM, W Pawlowski <pawlowski.w at gmail.com> wrote:

> Hello everyone,
> 
> I am new to accounting and new to GnuCash so right now I am going through
> accounting books to catch up but also hope that this group can help me get
> up to speed. I am in Ontario, Canada and I am registered for HST.
> 
> I have questions regarding purchasing parts which are then resold to my
> customers. How do I enter that into book keeping?
> I have opened new expense account - Parts Bought.
> I have also opened new liability accounts: HST Payable, HST Paid, HST Owing
> for tracking my HST obligations.
> I have just bought part, paid for it with cc, so I entered split
> transaction:
> Expenses:Parts Bought $2614.82
> Liabilities:Credit Card $2314.00
> Liabilities:HST:HST Paid $300.82
> It seems to be OK, but the balance on my credit card seems to be on the
> positive side, is that normal? Or what am I doing wrong?
> 
> At the moment I am using invoices which I have designed in Spreadsheet, is
> there a way to bring them into Gnu Cash or do I have to design new invoice
> in Gnu Cash and how do I do that?
> 
> What ever invoices I sent out I enter them into Income:Sales as split
> transaction, Assets:Accounts Receivable - the subtotal or parts and service
> charges and Liabilities:HST:HST Payable - the hst portion of the bill, is
> this correct?
> Now how do I mark which invoice has been paid? I know I make the deposit to
> the chequing and subtract from Accounts receivable but how do I mark that
> company A paid their invoice and company B is still outstanding?
> 
> Obviously the bank fees will go into Expenses:Bank Service Charge, the
> question is do they contain HST portion as well so they should be entered
> as a split transaction (which I assume is the case) or do I enter them
> without any HST component?
> 
> Thanks for all your help, I know it is long road ahead but I guess everyone
> needs to start somewhere.
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