Withholding tax because no ABN has been supplied in pre-2008 QuickBooks

Legacy KB ID: 1926

Question

A invoice has been recieved from a supplier who has no ABN.  How do I enter this transaction into QuickBooks so that the amount appears in the BAS report (W4 field)?

Answer

To enter a invoice from a supplier (bill) who has no ABN follow the steps below;

Create a Withholding account.
1) Select Lists menu > Chart of Accounts > Account > New.
2) Create a 'Other Current Liability' type account named 'ABN Withheld'.

Configure BAS.
1) In the 'Simplified BAS' click the 'Taxes and Amounts Withheld' tab.
2) Click 'W4' and highlight the 'ABN Withheld' account in addition to any other selected accounts.

Recording the transaction.
1) In the 'Enter Bills' screen select the supplier the bill is being entered for.
2) In the 'Expenses' tab enter the expense account the bill will be assigned to.
3) Select the regular tax code used for this transaction, e.g. NCG.
4) Tab to the next line and select the 'ABN Withholding' account, select no tax code.
5) In the amount field enter the Net Amount of the bill, place a negative sign ('-') before this figure.
6) On the keypad press '*' followed by the maximum withholding rate (currently this is 0.465 - this should be verfied by the ATO) and press 'Enter'.
The amount to be withheld will now be calculated.
7) Click 'Recalculate' on the Enter Bills screen.

The bill can now be paid in the usual manner.

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