When you have an Entity that accounts for GST on a cash basis, the following entries will enable you to correctly account for Hire Purchase payments in Access HandiLedger:
Cash BAS and Hire Purchase (HP) payments
In our example an asset is purchased for $33,000 which includes $3,000 GST. The monthly HP repayments are $402, of which $72 is unexpired interest and $30 GST.
Initial HP transaction, using the example the transaction is split as follows:
Debit account number 2860 Assets purchased with $30,000.
Credit account number 2100 Hire purchase with $40,200.
Debit account number 3101 Unexpired interest with $7,200.
Debit account number 3381 GST account to cater for future GST claims with $3,000.
NOTE: Account 3381 is a new account that needs to be created to cater for the GST you will be claiming back from the ATO over the period of the HP agreement. While it is an asset account it has been created under the liability section to keep it together with the other ATO GST accounts when printing.
Using the example above, the transaction for the first and subsequent payments would be split as follows:
Debit account number 2860 Assets purchased with $330, using the CAP tax code to ensure the $30 tax is posted to the correct GST account.
Credit account number 2860 Assets purchased with $300.
Credit account number 2000 Bank account with $402.
Debit account number 3100 Hire purchase with $402.
Credit account number 3101 Unexpired interest with $72.
Credit account number 3381 GST portion no longer claimable with $30.
Debit account number 1760 Interest paid with $72, using the FOA tax code to ensure the interest is reported correctly in the BAS.
