System Option - Goods & Services Tax (GST)

What is GST?

Goods & Services Tax (GST) which is also known as Value Added Tax (VAT) in many countries is a multi-stage consumption tax on goods and services.

GST is levied on the supply of goods and services at each stage of the supply chain from the supplier up to the retail stage of the distribution. Even though GST is imposed at each level of the supply chain, the tax element does not become part of the cost of the product because GST paid on the business inputs is claimable. Hence, it does not matter how many stages where a particular good and service goes through the supply chain because the input tax incurred at the previous stage is always deducted by the businesses at the next step in the supply chain.

Please refer to this link for more info: http://gst.customs.gov.my/en/gst/Pages/gst_wi.aspx

In QnE System, there are 3 selections for GST Module as follow:

1) GST-This is the first generation where only allow users to define GST rate per transaction.

*Global GST Only

2) Item GST/VAT-This module is allow users to define GST rate either per item or per transaction.

*Item GST and Global GST

3) This module is allow user to define GST rate either per item or per transaction, This module also allow users to define the GST description by themselves.

*Item GST use only

1. Module Selection – GST

Set Up - GST Rate

• First users required define default GST Rate in system option (File => System Option => Under GST Tab)
• GST Registration No –  The register number from GST
• Input GST (Purchase) – The default posting account for Purchase GST ( Input Tax)
• Output GST (Sales) - The default posting account for Sale GST ( output Tax)

In the same time, user also allows to define GST rate by period if necessary. (GST => GST RATE)

Transaction Screen

• GST module will affect in Sale Invoice, Debit Note, Credit Note, Case Sale, Purchase Invoice and Purchase return with additional 2 columns GST Type and GST Rate at bottom of transaction screens. Users are allowed to modify the GST Rate if necessary.
• However this GST module only allows users to define GST rate per transaction.

Journal

• The GST amount will post to default posting account for Sale GST that defined at the beginning.

2. Module Selection – Item GST / VAT

Set Up – GST Rate

• First users required define default GST Rate in system option (File => System Option => Under GST Tab)
• Compare with GST Module, there is an additional option called “Default Tax Inclusive” in this module.
• If users tick this “Default Tax Inclusive” option, system will include the tax amount in the Subtotal of the particular transaction instead of calculate the tax amount based on the subtotal.

Example:

If a Sale Invoice with the total of SGD1000 and the GST tax is 5%, the calculation as follow:

1. With Tax Inclusive

• With Tax Inclusive, system will include the tax amount in the subtotal.
• System will adjust the price in order to match the sub total is exactly same after included the tax amount.

Calculation for Net total include 5% GST as follow:

SGD 1000/1.05% = 952.3809523

952.3809523 X 1.05 = SGD1000

2. Without Tax Inclusive

Calculation for Net total include 5% GST :

SGD 1000 x1.05 = SGD 1050

Transaction Screen

• Item GST / VAT module will affect in Sale Invoice, Debit Note, Credit Note, Case Sale, Purchase Invoice and Purchase return.
• This module offer additional 2 columns (Tax and Tax Amount) in transaction screen if compare with GST module (1^st Generation), therefore users can define the GST rate per item or per transaction.
• In the same time, users have option where the particular transaction is tax inclusive or not based on the situation. If users tick “Tax Inclusive”,system will adjust the price in order to match the sub total exactly same after included the tax amount.

Journal

• Since the users ticked “Tax Inclusive “in the transaction, system will auto calculate and adjust the sale amount in order to match the net total is exactly same after included tax amount.
• Calculation for  Sale  (AMD XP/1800) include 5% GST as follow:

SGD 1000/1.05% = 952.38

5% of 952.38 = 47.62

3. Module Selection – Item GST / VAT 2010

Set Up – GST Code

• This module offers a new feature where users can define the GST type by themselves.  (GST => GST CODE)
• When create a new GST Code, users require to define the transaction type and GST posting accounting
• Remark:

Transaction type: Input Tax (Purchase Transaction) & Output Tax (Sale Transaction)

GST Posting Account: The default posting account for new created GST code.

Transaction Screen

• In this module, users require to select tax code per item in transaction screen.
• However users are allow to adjust the GST rate at the bottom of transaction screens.

Report

There are 2 reports that available in GST module:

1. GST Summary Report 

2. GST Details Listing 

Please find the updated documentation for GST module in details at \\IBMX3100M4\DFS_Support\Tips\System option - GST