GST and GnuCash A couple of weeks ago I posted a question about this. I got a couple of replies to the effect that others were interested in any solution. After trying several possibilities, here is the one that I think works best. I have used it now for a week or so and it seems to handle the problems. Background GnuCash is a double accounting system. It has a "chart of accounts" rather than "categories" such as Quicken or other simple cash accounting systems. Every transaction is entered twice and represents a transfer from one account to another. The "chart of accounts" is actually a tree structure. The top level of the tree (nearly) always has the same form: Assets Liabilities Income Expenses There may be others, but these are the basics. Each of these are "container" accounts that have sub-accounts or sub-sub-accounts where the real entries are made. GST Accounts The key to making GnuCash work with our rather messy GST is to create two accounts, one a sub-account of "Assets" and the other a sub-account of "Liabilities". Call the asset sub-account "GST Credits" and the liabilities sub-account "GST Payable". Whenever you have a GST related transaction, whether a "supply" or an "acquisition", some component of it is sent to one of these two accounts. For example, a "supply" is when you sell either your services or a product. One eleventh of the amount you are paid is GST Payable. It is a liability that you will pay off (usually) once each quarter. On the other hand, one eleventh of a GST-related acquisition is an amount that you can off-set from the amount which you owe. It is an asset that should be recorded in the GST Credits asset account. Advantages/disadvantages There are other ways of doing it, but this gives you accurate reports, particularly balance sheet reports. The downside is that all GST-related transactions have to be entered as "splits". This isn't as bad as it sounds since GnuCash memorises the "GST" part of the split and automatically selects the "GST Credits" account when you are making an acquisition. Room for improvement Since the split is always 1/11 of the main transaction, it is obviously programmable. I'm not sure whether this should be done on a per transaction basis (a box to tick if the transaction is GST related) or an account basis (certain accounts will only have GST related transactions). Reading I became quite interested in the structure of GnuCash accounting. There is a good simple tutorial on double entry accounting at the Online Women's Business Center: http://www.onlinewbc.org/docs/finance/bkpg_acct.html It is better than the on-line explanation in the GnuCash manual. Read the OWBC stuff first, then the GnuCash stuff makes more sense. Please let me know if you have any better solutions!! Cheers, Alan -- ------------------------------------------------------ Alan L Tyree [EMAIL PROTECTED] http://www.law.usyd.edu.au/~alant Tel: +61 2 4782 2670 Mobile: +61 419 638 170 Fax: +61 2 4782 7092 -- SLUG - Sydney Linux User Group Mailing List - http://slug.org.au/ More Info: http://slug.org.au/lists/listinfo/slug
