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MYOB – When Overwriting Tax Codes – Which Is Best – N-T or FRE?
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Published on Tuesday, 30 April 2013 14:35
Client asked – “When you overwrite the default tax code for and expense account – which one do we use: N-T or FRE when no GST?”
You can use EITHER! – some use FRE for Sales and the N-T for purchases – some the other way around.
It is simply choose which one makes sense to you – or the SAME code for both – many bookkeepers and accountants do.
A suggestion on the MYOB Community blog is:
“Generally FRE is the tax code used for a goods or service which is reportable on the BAS but has no GST or a rate of zero GST (some will recommend that you use a separate tax code to distinguish between the no GST and Zero GST). N-T is normally used for transactions that will not be reported on the BAS like transfers between your bank accounts, payment of superannuation, payments to the ATO for your BAS, etc.”
http://community.myob.com/t5/Tax-and-Business-Activity/FRE-amp-N-tax-codes/td-p/45477
This is a good idea, but it’s one more thing to remember.
Sometimes it is easier to just do all NON-GST as N-T then it is all together – that is what we see a lot of businesses do.
Having TOO many codes makes the Tax reports busier – and FRE and N-T achieve the same result! – No GST, and mostly all transactions would be listed in the total for Purchases, so easier to group together.
Just decide, but make it easy for the data-entry person to remember – or automate it a bit using “Recurring Transactions” (keeps a record/memory of common transactions and the way you want them coded and set up).
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