Manual Bookkeeping Entry for GST/HST Refund
According to your topic "Recording GST/HST Using Manual Accounting Systems", the information provided is super, except for the last paragraph which leaves me puzzled.
It says if I receive a refund from CRA, I would DR Cash (good) and CR GST/HST Payable (??).
If I have a CR account in the GST/HST Payable account, then I owe CRA GST. If I repost a CR to this account, then it seems as though I still owe that money. Wouldn't a refund go in, maybe, a Rebate account, rather than the Payable account? or am I missing something?
Thanks is a great question!
What you are forgetting is that when you sent in your report to CRA, you made a debit entry to the GST/HST Payable for the amount of the refund.
Once you get your refund, the credit to the GST/HST Payable clears that receivable you set up.
Does that makes sense?