How to record customer overpaid with service tax

This support note is suitable for.

• ABSS Accounting v27.1
• ABSS Premier v22.1

Introduction

Service tax is a cash basis transaction. So, service tax only will be capture once payment is made. However if the total invoice is RM 1000 but we received customer payment more than RM 1000, ( example we received RM 1500) so the Service tax will calculate base on RM 1500 which is not correct. So this support note will guide you how to record the customer overpaid without effect service tax figure.

Example you already record your sale transaction  RM 1060 with the service tax ( S06) (refer image below).

and your customer paid you RM 1500, so below is the way how to record customer overpaid to make sure only RM 1060 will capture for Service tax :

1) Go to received payment and record the amount received RM 1060 and amount apply also RM 1060.

2) Record over payment balance using Credit Note.

Kindly take note, when you record customer over payment use the credit note, the account you need to select is the same Bank Account selected during receive payment under Asset.

3) Pay refund 

If customer want you to pay refund, so you just click on pay refund and the step is Done until this step. However, if you want to knock off with the next sale, you need to follow the step below, because for service tax, if you apply to sale, the Service tax for next invoice will not be captured. 

If want to use the overpayment to knock off the Invoice

Example you have another sale RM 2120 ( INCLUSIVE service tax 6%) and you need to knock off RM 440 balance from extra payment. So below is the step :

4) Go back to sales register > Returns & Credits > pay refund > select HSBC Bank account.

If in the circumstance where this extra amount needed to be knocked off with future invoice then this overpaid amount must be recorded in Banking > Receive money instead of recording it as a Credit Note. 

5) Create the Customer Overpayment account type as Credit Card under Liability.

6) Go to Banking > Receive Money.

7) Then, when want to knock off with other invoices Go to Sales > Receive Payment > Choose the Customer Overpayment account under the Deposit To Account.