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Invoicing - Override GST amount where GST differs from tax rate percentage

Started by Matthew Woolnough -   in Feature Requests | Not planned

Hi xero,

Would love the ability to override per line item the gst calculated rather than have to figure how much the gst inclusive cost is and then subtract that from the total to the amount with no gst included at all. Bank link has this feature which comes in handy for those with clients in food sales and health care

Regards
Matt
You can select whether to enter invoices as either inclusive or exclusive of sales tax (from the 'Amounts are' drop-down) and Xero will calculate the tax amount - is that what you mean?
 

Jules D (Community Manager)  

Hi jules,
no some transactions in australia (sorry not sure where you are and have had replies from o/s people who didn't quite understand the problem) dont have the full 1/11th GST. eg you might spend $105 including GST on health products and it only has $5 GST not 9.55, so in all the other software like banklink and myob you can manually override per line, in xero unfortunately you have to figure out what amount has gst on it and what doesnt and enter it over 2 separate lines. a complete pain in the behind.
regards
matt
 

Matthew Woolnough  

@Matthew - thanks for raising this as a feature request. Yes, the way you're doing it now over 2 lines using 2 tax rates is the only way to achieve a specific amount of GST that's not the same as the amount calculated by an overall tax rate. Variable tax rates is something we need to look into.

If others are keen on this, please vote. In the meantime, here's is how you'd achieve this if you're in the same situation.

To ensure the correct GST entries for the Activity Statement, work out the portion included that’s GST free, and record it separately on the invoice.

Using the example above for $105, where only $5 GST is included - $55 out of $105 is subject to 10% GST, and the remaining amount, $50 is GST free.

When you record this transaction in Xero, select that the Amounts are 'Tax Inclusive' and enter separate detail lines:

$55, select tax rate GST on expenses
$50, select tax rate No GST (use No GST if you require this amount to be reported as a GST free purchase on your BAS. If you wish to exclude it from BAS, use ‘GST Exempt’)
 

Catherine Walker (Community Manager)  

I definitely need a more complex tax setup as well to support the United States' multijurisdictional tax model.
 

Philip Denton  

Hi All,

I have as similar issue but slightly different and need some advice please.

I have a bill from a supplier that has a credit applied after the subtotal and GST application therefore the GST is higher than 10% as a percentage of the value.

i.e.

Invoice Cost $573.43
Credit $94.28cr
GST $54.75
Other Charges $4.05
Total Invoice $537.95

See attached link

I am using Shoeboxed, which is preventing the transactions form coming in to Xero as the value is rejected by Xero so I have to re-calc the GST value down to 10% of the total invoice value.

How do I then add the additional GST in?
 

James Nicolson  

The plot thickens...or rather get's a little more confusing.

I have tried to enter the details of these transactions now by adding the credits etc and there was still a GST variation from the standard 10%. I think this is because there are certain elements that make up the invoice cost that are GST Free Expenses (it's for AGL Electricity charges).

When entering the first transaction I got presented with an + expansion option on the Bill which opened up a column to manually enter GST amounts. BINGO I thought, it just made the adjustment at the bottom of the invoice.

See Screen Shot

http://https://docs.google.com/file/d/0B4hoOTk4ExuoSTlHTHZ6V0YzQUk/edit?usp=sharing

Then I tried it again thinking I had cracked the issue and now the + option does not appear?

See Screen Shot

http://https://docs.google.com/file/d/0B4hoOTk4ExuoUWp3VTNhUXhEa1E/edit?usp=sharing

I'm now pretty confused and hoping someone can shed some light on how to get this option back or why it appeared in the first place?
 

James Nicolson  

I definitely agree that there must be the option to manually adjust the GST component. It's not often that it needs to be done, but there are plenty of situations where it would be useful.

To be honest, for me, it's almost a big enough issue for me not to change over from MYOB. Decisions, decisions...
 

Berwan Wieske  

Agree with all the above. Car registration in South Australia is classic case where GST component on compuldory Third Party insurance is not 10% hence it is not as simple as splitting transaction into 2. Definitely need ability to manually override GST calc where reqd/appropriate
 

Mitch Uzelac  

I've seen a number of other replies here and thought I'd share how we've dealt with this. I was pretty perplexed to start with as the GST auto calculates dependant on your chosen settings in the Purchase. I do feel though that we've ended up with a very easy to work process.

I've attached some screen shots to show how we've done it. Specifically I've added examples of South Australian vehicle registration @Mitch.

Registration 1 - directly imported from Shoeboxed...I just accepted all of the GST and descriptions as we really don't need the detailed breakdown.

Registration 2 - directly imported from Shoeboxed...manually set and entered all of the figures, GST and descriptions to provide the detailed breakdown.

Electricity 1 - directly imported from Shoeboxed...manually set and entered all of the figures, GST and descriptions to provide the detailed breakdown.

Hope this helps.
 

James Nicolson  

I use @James method as a work around, but it doesn't always work.

For example; with importations of inventory.

1. 1st November: Payment is transferred to supplier for inventory purchase

2. 30th November: Inventory arrives and clears customs (and GST is charged on original purchase)

So how do you reconcile correctly and include GST when 50% of total customs bill is is just GST!?
 

Justin Snyder  

Agree, in NZ like Customs invoices where the GST content is not necessarily 3/23 and insurance commission mixes of both life insurance commissions and fire & general commissions. At present we have to split them out and present two transactions,
 

Barry King  

Yes having to manually calculate a split when the invoice says how much the gst is a long winded pain.
A quick single one line entry with the ability to manually input the correct gst amount is a must and can't see how it is a big problem if MYOB can do it!!
This is a NZ issue as well
 

Trevor Wall  

Just moved to xero and this is a major issue for us... I assumed there would be an option to over ride GST amounts since it's common for invoices to include items that are subject to GST and items that aren't. We have a grocery store (fresh produce no GST/ detergent etc GST) so presents a real problem. BIG vote from me for overRide functionality.
 

Ben Sirl  

Yes totally agree that a manual GST over-ride facility would make it a lot easier to account for GST when it is not a simple percentage calculation.
 

Sean McGarry  

I totally agree. This is a major flaw. Australian Tax Law states that the GST you claim as an input MUST be the same as what the vendor puts on his invoice - even if it's wrong. It gets even more complicated where you have refunds and stuff as part of your invoice.
 

MARK BURTON  

Hi there, has this feature request been shortlisted? When can we expect to have it included in XERO?
 

Natasha Mallon  

Keep voting please to help drive the priority and raise the profile. I'd vote too if I could!
I'll focus on the Aussie side as thats what the OP is about and do appreciate there are other regions touched on in comments.
In a nutshell, to address this it's more about around updating Xero for different Activity Statement reporting options and methods.

Xero Activity Statement and GST
Xero currently uses the calculation worksheet method for Australian GST and Activity Statements; GST is 1/11th of an inclusive transaction value, regardless of the GST rate used or value calculated.
EG you had a 5% GST rate in Xero (available now) or override the tax amount (we could turn on for AU), the calculation worksheet method Activity Statement would calculate GST as 10% as intended.

Activity Statement updates required
So, the issue is more about ensuring the amounts flow through as they need to for reporting on an Activity Statement.

To properly support non 10% GST or override tax amounts, we need to offer an additional Accounts method option. This method takes the actual tax amounts from transactions and *11 to obtain an inclusive gross amount. (It's basically the other way around from what the calculation worksheet does.)

This is on the cards for us with the new reporting engine we're developing; an updated Activity Statement, different methods, linking to accounts and payroll etc. We just can't really offer these updates until we're well progressed with the roll out.

Non 10% GST rates and Activity Statements until we offer the additional option
Whilst we do not offer an Accounts method, we suggest using split line transactions. This has been explained earlier in the thread by Catherine.
This approach ensures the right amounts go to the Activity Statements and it works ok. It can be a pain if you have a significant volume of transactions where GST is not 10% or some other GST rate agreed with the ATO.
We've updated our GST rates for Australia since Catherine posted, but the logic is the same. http://help.xero.com/#GSTChanges

Xero and GST on Imports
In respect to GST on Imports, Xero caters for this already by using a specific tax rate(s) without you needing to split the transactions lines. Check out help centre for more information: GST on Imports Australia and separately New Zealand.
Hope this helps explain, cheers Tim
 

Tim Wright (Xero Staff)  

It is also a problem for Google Play Store merchants, I have a monthly payment from Google which typically has 1000+ worldwide transactions, so some have VAT, others don't, I have developed a program to produce totals but obviously the percentage VAT of the total is different each month.
 

Roger Womack  

I totally agree, I've literally been begging for this feature for 2 years since we switched to Xero. I've even considered switching to MYOB because the data entry is so painstaking in Xero! (and I hate MYOB).

Here is a comment I added to the Xero blog about this recently;

"As the person that enters all the data into Xero for both of our businesses I’d love to see the usability improved. The thing that I find most frustrating is the lack of calculation function in Xero. For example, one of our businesses is a restaurant and many of the receipts have a GST and a non GST component. The only way to enter this currently is to enter the total amount and then for the GST amount get a calculator and multiply the GST amount by 11 to get the total for that line and then when I go to the next line for the amount that is non GST I have to calculate the total minus the GST amount. I find this so tedious and bizarre for such a forward thinking software as Xero. As I understand most other accounting software autocalculate and autofill these amounts. Another thing that would help is if Xero recognized a particular Contact/Supplier and then autofilled the lines based on history, for example, type in Melray Meats add the total and the lines autofilled. This would make the job of the data importer so much easier. I’ve written in the forums periodically about this over a couple of years since we switched to Xero and every update I wonder if this will be the one to make data entry easier. Is this on the list of to do’s?"

 

Stephen Anderson  

Just moving to Xero for one of my clients now. We need to be able to calculate in cells and override gst amount - phone bills, insurances, tax free food and water, some clients bill and put a total figure for reimbursable expenses and the amount of gst (not always 1/11th, as some exempt).
 

Deborah Brooks  

Just moved to Xero. We have an online retail business with lots of post. The post GST almost never equals standard 10% so an override is essential for efficiently inputting this. I wouldn't have thought it is so hard for Xero to fix this! I changed to Xero from spreadsheets to save time, can't say I've got close to that goal yet.
 

daren castle  

How does this GST override when you have received a bill that is part GST taxed and part non-GST taxed? Should I pay the bill in 2 separate amounts? So when I reconcile the bank statements, I can allocate each portion to it's appropriate GST with/without account?
 

John Finlay  

Xero please bump this up your priority list. We have a number of clients that would love this feature.
 

Marisa Toto  

From a data integration with 3rd part products perspective not being able to enforce the GST at line level independent of the gross causes problems. A number of our major clients would want to be able to push data into Xero (via spreadsheet or the API) with custom GST levels at line level but this is not possible.
 

Robert Leonard  

Hi Xero,

Please highlight this issue as priority. We are in Australia and many goods and services in our industry (real estate) are not strictly 10%. We would love the ability to alter GST on individual items entered.
 

Aishling Waldron  

Is this feature in the works? I just started using Xero and after a day of having to separately calculate the GST component on an awful lot of transactions I honestly wish I'd started using a different software.
 

Adam Liaw  

We NEED this feature added!!!
 

I.T. Solutions Tasmania  

So so so need this feature ... however I am so pleased to report a fab and easy work around.

Our bill was $128.88 inc GST. The GST component was $99.28!!! So the actual cost of services (Telstra bill ... they always mess GST up!) was only $29.60. Crazy stuff.

Anyway the work around:
Expense a/c: Telephone (GST free exp) $29.60
Expense a/c: GST (or whatever your GST a/c is called) (GST free exp) $99.28

Subtotal $128.88
GST $0.00 (but it shows the $99.28 under the GST Chart of accounts if you look)
Total $128.88

This means there is no GST listed at the bottom, but if you go and check the GST a/c it shows up just fine! I hope this helps someone else :o)

 

Merilyn Bullen  

VOTE FOR THIS PLEASE. It's a must have feature.
 

Mellissa Fyfe  

A definite must for us - many items do not incur GST in Australia, and calculating it out by hand is driving me crazy. I keep asking my boss to move us back to MYOB for this reason but he loves the online cross platform facility.
 

Kali Lawrie  

This a MUST - it is so time consuming trying to split the costs over numerous lines just to get the GST to match with the GST we are being charged, a simple feature to allow a manual over-ride of the GST would be a time saving solution
 

Jo Sproull