I am simplifying it quite a lot, but for GST/HST you would essentially have two G/L accounts
- GST/HST Collected on Sales
- GST/HST Paid on Purchases
You would setup the BC tax engine to calculate sales tax on purchase/sales documents and the tax entries from a purchase invoice or a sales invoice would go to those two accounts. Every month/quarter/year depending on when you have to submit your info to the CRA you would net the balances of those two accounts and if you collected more tax on sales than you paid on purchases you would have to remit that difference to the CRA. To do both of those 2 things you would simply use the balances of the two G/L accounts or the Sales Tax Collected Report. The balances of the G/L Accounts is the easiest way. You would take the balances and go to the CRA site and enter them in their form on there.
To record the remittance of tax you would simply do a Journal Entry where the debit is a G/L Account and the credit is the Bank Account Card. If you get a refund the debit/credit are simply reversed. A vendor/purchase invoice is not used. For PST tax its a similar process, however, you would only typically register the tax collected and remit that.
