Where a sundry receipt of funds contains GST, we cannot use a Deposit type entry. This is because a Deposit entry type in Quickbooks has no GST fields (a weakness in the software). This can lead to the following common mistakes:
- GST does not get accounted for on cash sales (resulting in under-payment of GST)
- The transaction is split over 2 or more lines, the last line being coded to the GST Control account with the GST total. While this will achieve the correct accounting treatment, the GST reports will be inaccurate, because this amount is not recognised as GST in Quickbooks. Only amounts with a GST code get recognised.
Solution
Either:
- use a Journal instead of a Deposit to record the receipt (Journal entries have GST code fields)
OR
- use a Cash Sale instead of a Deposit. Note that a Cash Sale requires items for coding,there are no fields for ledger accounts.