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Value Added Tax for e-commerce sellers

Value Added Tax for e-commerce sellers
 

Introduction

Support for VAT, GST, HST and PST

Greenback can help automate the accounting of VAT, GST, HST and PST to the appropriate accounts within your accounting file.

What are value added taxes?

VAT - A value-added tax (VAT) is a consumption tax placed on a product whenever value is added at each stage of the supply chain, from production to the point of sale. More than 160 countries around the world use value-added taxation, and it is most commonly found in the European Union.

GST - The goods and services tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services. France was the first country to implement the GST in 1954, and since then an estimated 160 countries have adopted this tax system in some form or another. Some of the countries with a GST include Canada, Vietnam, Australia, Singapore, United Kingdom, Monaco, Spain, Italy, Nigeria, Brazil, South Korea, and India.

HST - The harmonized sales tax (HST) is a consumption tax in Canada. It is used in provinces where both the federal goods and services tax (GST) and the regional provincial sales tax (PST) have been combined into a single value added sales tax.

PST - A provincial sales tax (PST) is imposed on consumers of goods and particular services in many Canadian provinces. Several provinces have agreed to integrate their provincial sales taxes with the federal Goods and Services Tax (GST), charging a single Harmonized Sales Tax (HST) instead. The HST combines the GST with provincial sales taxes.

Greenback works hand in hand with your accounting program

When exporting transactions Greenback will ask you to choose the appropriate tax code from a list of supported tax codes configured within your accounting program. To help you choose the correct tax code, Greenback will also display the tax jurisdiction and tax rate from the transaction as provided by the upstream provider.

Tax code memory mappings

To help automate the assignment of VAT tax codes, Greenback works hand in hand with your accounting program to map VAT taxes to the appropriate accounts during export. Greenback will look for previously exported sales transactions that match the postal code of the current transaction and default to the appropriate tax rate/jurisdiction. VAT tax rate mappings can be overwritten at any time by manually defining a different tax rate from the drop menu.

You must setup your tax codes first

Before using Greenback you will first need to configure the appropriate tax jurisdictions within your accounting program.

Configuring QuickBooks for VAT & GST

Use the links below to learn how to setup your tax codes in QuickBooks Online.

-> How to set up VAT rates & codes in QuickBooks Online.
-> How to setup GST in QuickBooks Online

Configuring Xero for sales tax

Use the links below to learn how to setup your tax codes in Xero.

-> How to setup tax rates (VAT, GST, etc.) in Xero

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