I'm setting up sales tax for a Canadian company. I'm struggling to configure sales tax to accommodate the posting requirements for PST.
Tax Type A - GST
GST is a VAT-style tax in Canada. Applicable entries are summarized as follows for a $100 purchase + 5% GST (total of $105):
DR Office supplies 100
DR GST paid on purchases 5
CR Accounts Payable -105
* I am able to correctly set up this tax type
Tax Type B - PST
PST (provincial sales tax) is not a VAT-style tax. Any PST amounts paid are not recoverable. The applicable entries are summarized as follows for a $100 purchase + 5% PST (total of $105):
DR Office supplies 105
CR Accounts Payable -105
* I am NOT able to correctly set up this tax type.
Combined GST & PST
Here's an example of how a purchase of office supplies in Saskatchewan works. The purchase is for $100 + 5% GST + 5% PST (total of $110):
DR Office supplies 105
DR GST paid on purchases 5
CR Accounts Payable -110
I understand there's a GL Parameter called "Apply US taxation rules" but all it does is force the PST value into a GL account specified on the sales tax Ledger Posting Group. This is incorrect however, the PST value needs to be included in the DR to Office Expenses.
Hope I've been clear here...my issue is properly setting up PST.
Thanks
*This post is locked for comments
I have the same question (0)
