[GNC] Treating tax authority as a vendor

[Adrien Monteleone]

No, it is one or the other, either use an SX or use the Business Features. You can’t at this time, schedule a recurring invoice, bill, or payment. (Technically, you can schedule the payment, but then you have to manually assign it as a payment to a particular bill when it gets created to make the Business Features cognizant of it.)

You don’t want to manually edit or create any transaction directly in either the A/R or A/P accounts that were created when you activated the Business Features, those are special accounts. If you go the SX route you won’t be involving the standard A/P account. You’d need to make a generic Liability account and label it ‘Other Accounts Payable’ or something similar. It *can* be set as a child of the main A/P account though so the balances roll up on the Accounts Tab and in reports. (if you choose that report option)

The SX route would also not tie anything to a Vendor because the Business Features won’t ’see’ those transactions. But you can still run some reports (like the Transaction Report) which could key off the Description(Payee) in multiple accounts. Where you’d lose something reporting-wise would be with respect to the Vendor Report and Payables Report. (at least as they are presently designed)

If you have no issue forgoing the Due Reminder and posting/paying the same day, I’d say just stick with the Business Features. If your bills are similar each period, you can simply duplicate the last one and adjust amounts for each line item. I do this with most all of my bills as many of them have recurring line items each month/year, etc. It saves me lots of typing time.

Regards,
Adrien



> On Jan 18, 2019, at 11:21 AM, gnucash.dgr9z at ncf.ca wrote:
> 
> Thanks for this. Seems the date issue should be OK if I post and pay the tax bill on the date of the actual transaction. 
> 
> I don't see a way to use scheduled transactions to create/post/pay invoices/bills. If I used a scheduled transaction instead of a bill, what would the implications be, other than loosing the association with a vendor? Would it gum anything up (reports etc) to post directly to AP?
> 
> Ron
> 
> ----- Original Message -----
> From: "Adrien Monteleone" <adrien.monteleone at lusfiber.net>
> To: "Gnucash Users" <gnucash-user at gnucash.org>
> Sent: Thursday, January 17, 2019 3:48:08 PM
> Subject: Re: [GNC] Treating tax authority as a vendor
> 
> Ron,
> 
> I do this for property taxes with no issues that I can think of.
> 
> If you want to do this with pass through payments like sales taxes/VAT you might need to think carefully.
> 
> In such cases, you’d likely post via the invoice the tax charged/collected to a "Liability:Sales Tax Due" account or something similar.
> 
> Entering a bill for the amount would ‘pay’ this upon posting and transfer the amount to A/P. You may be fine with this, but if you’re expecting to use that special liability account as a reference to what is owing or helping you to track collections vs. remittances, you’ll run into some mental gymnastics on the dates.
> 
> If you wait to post the tax bill till its actual payment date, you’ll forgo the Bills Due Reminder feature for it.
> 
> Instead, you might want to just use a Scheduled Transaction for whatever day of the month/quarter and be sure to set it for manual review so you can tailor the amounts. With this, you might also be able to use a variable to assist with the manual entry. It will prompt you for the variable’s value when you agree to post the transaction. (such as the total sales you are reporting and then the SX will have formulas to calculate the tax owed based on those sales, if that is how you file, you’ll have to tailor that to your local laws/methods) I know my local jurisdictions will collect for several authorities with one payment, and then they let you deduct a “Vendor’s Compensation” from that. (usually something small like 1 or 2% of the tax owed) That could be broken out in two or more splits. That Vendor Compensation is technically a non-operations revenue stream, not just a reduction of liability. (depending on your jurisdiction) The SX could calculate all of this based on the Total Sales variable you are reporting.
> 
> There might be some other considerations. Perhaps someone else who does or has tried this can chime in.
> 
> Regards,
> Adrien
> 
>> On Jan 17, 2019, at 6:24 AM, gnucash.dgr9z at ncf.ca wrote:
>> 
>> Hi all,
>> 
>> Is it recommended/not recommended to set up your local tax authority/ies as vendors and pay taxes against bills? Are there advantages or disadvantages to doing this from an accounting perspective? Similarly, are their design assumptions in Gnucash that would make it a good/bad way to set up tax payments?
>> 
>> Thanks in advance!
>> 
>> Ron
>