QuickBooks Online GST Explained: Filing and Corrections
Singapore brought in GST on 1st April 1994 at just 3%. Today, it’s hit 9%. Under the GST law, there’s a penalty for late filing of GST returns. Additionally, it’s an offence to collect or attempt to collect tax on non-taxable goods and services without a reasonable excuse or through negligence, or to charge a higher tax rate than the prevailing rate. Hence, getting your filing right matters more than ever. But what if you mess up your GST return in QuickBooks Online? Here’s how GST works in QuickBooks and what to do when things go south.
What is GST?
GST (Goods and Services Tax) is, in layperson’s terms, Singapore’s tax on stuff you buy and services you use. It’s like VAT in other countries.
When you buy things for your business, you pay GST on those purchases (Input Tax). When you sell to customers, if you’re a GST-registered trader, you collect GST for IRAS (Output Tax). So, when the Input GST is greater than the Output GST, you claim a tax refund from IRAS; however, if your Input GST is lower than the Output GST, you pay IRAS for the difference.
The GST system prevents the same money from being taxed over and over again throughout the supply chain, which would inflate the price for consumers like you and me.
How Does QuickBooks Online Handle GST?
QuickBooks Online takes care of the tricky bits for you. It sorts out the setup, does the maths, and handles reporting so you can get on with running your business.
Upon switching on GST in QuickBooks Online, QuickBooks automatically:
- Creates all the GST ledger accounts you need
- Sets IRAS as your default tax agency
- Updates the tax table with the latest GST codes and rates, ready to use
GST Account Structure
QuickBooks Online uses three main ledger accounts to keep your GST organised:
- GST Control Account: Tracks all the GST you collect from customers and pay to suppliers.
- GST Expense Account: Records GST you can’t claim back, like blocked expenses or disallowed expenses.
- GST Suspense Account: Holds GST you owe or can claim whilst you sort out payments with IRAS.
How GST Filing Works
As you add transactions with appropriate GST codes and rates, QuickBooks keeps a running total in the GST Control account. When you file a return, that GST amount moves (gets reclassified) from the GST Control to the GST Suspense account, waiting for you to pay IRAS or claim a refund.
QuickBooks Online opens a new GST cycle (the current cycle) once you’ve filed the GST. The GST cycle status turns from ‘Open’ to ‘Filed’, and from ‘Filed’ to ‘Filed and Paid’.
What If There’s a Mistake?
Follow the GST guidelines from IRAS to adjust your GST Returns (Form 5) or Form 7 for overpaid or wrongly paid GST if you meet the conditions. However, sometimes it could be due to a user mistake – accidentally clicking the ‘Prepare Return’ hyperlink in the Action column of the GST cycle, and clicking the ‘Mark as Filed’ button unintentionally when the cycle isn’t yet due.
Common Mistake Example
For example, the current GST cycle is from July to September, but in the middle of August, you click the ‘Prepare Return’ hyperlink to check on the GST payable. Instead of clicking the ‘X’ button to close the preview and return to the GST Navigator, you accidentally click the ‘Mark as Filed’ button and follow the wizard to close the GST cycle.
You’ve made a mistake. You’ve closed a GST cycle that wasn’t supposed to close. Sadly, there’s no ‘Undo’ and no ‘Delete’ option available in QuickBooks Online. You cannot fix it yourself, period. You need to contact QuickBooks Support and request that they reverse the filing.
Security Measures
It’s part of the fraud and security control that QuickBooks Support will only revert filings after verifying that the request comes from an authorised individual—this keeps your data secure.
The wrongly filed GST Return remains in the GST Returns history with a ‘Reopened’ status, despite being corrected; it serves as an Audit Trail. In addition, QuickBooks creates a new cycle for the same period range for filing your GST Return.
GST Payment Corrections
However, suppose the mistake was in the payment, such as a data entry error (or an Error of Original Entry). In that case, you can delete the payment from the GST Navigator and redo the payment if you haven’t completed the bank reconciliation.
Final Thoughts
QuickBooks Online provides you with practical tools to manage your GST—from setup and tracking to filing of GST Returns, plus security measures to safeguard your financial data. Stay on top of things, keep your records tidy, and don’t be afraid to ask for help when you need it.