Quick method of accounting in QuickBooks online

quickbooks-online

I use QuickBooks online for accounting.

For collecting sales taxes I choose Quick method.

But I don't know how I can use it in QuickBooks online.

I found the following question on Quickbooks forum:

client enters sales and expenses net of HST to show HST on invoices,
where does credit get posted when pay HST based on quick method, so
less than owing per the balance sheet?

And answer:

QB does not understand the "Quick Method".

But it's answer is two year old.

It's still not possible?

Probably I should contact QuickBooks support and I'll do it, but maybe somebody has some experience in using Quick method in QuickBooks?

Best Answer

I contacted QuickBooks support and they gave the following link:

QB does not understand the "Quick Method". (Which in any case is not really all that "Quick".)

My recommendation:

Do not track HST on MOST expenses, only on those rare expenditures that qualify for treatment as ITC (Input Tax Credits) under the Quick Method - typically capital expenditures, for example, but research this further for your client's benefit. For most expenses, "operating expenses" according to CRA, the HST paid is just part of the expense.

Calculate the HST "manually" (Sales + HST collected) x rate (remember to reduce the "Quick Method rate" by 1% on the first $30,000). Then calculate the "discount" (actual amount collected, minus the manual calculation). Enter the "discount" as a Sales Tax Adjustment using the Sales Tax Item for "Adjustment to HST on Sales". For the "Sales Tax Adjustment Account" use something like "Miscellaneous Income" - yes, this is income subject to income tax, but then the HST paid on expenses is also part of your deductible expenses.

QB will not correctly report the Sales and Other Revenue (Line 101 on the return) so do not file online directly from QB. Instead choose "File by Paper or Other Method", then use either NETFILE or paper.

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