I accidentally used an incorrect tax code while processing an invoice. The cheque has already been processed. Is it still possible to correct the tax code?

Yes, a correction is possible when an incorrect tax code has been used, in any transaction, even after it has already been processed. You’ll need to process a journal entry to credit the incorrect tax code and debit the correct tax code. Please see the example below.

For detailed instructions on how to create a journal entry, please refer to the “Journal Entry Create” quick reference guide (QRG):

Reference Guide: Create Journal Entry – FB50 

The following illustrates an example of a document correcting an incorrect tax code:

Original transaction containing the incorrect tax code:

 

 

 

 

 

 

 

Journal Entry required to correct the tax code/amounts:

 

 

 

 

 

 

 

 

 

 

Impact of the tax recalculations on the $1150.00 example above:

 

 

 

 

 

 

 

 

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Learn More:

• Reference – Tax Code Summary Table
• Documentation & Support – General Ledger
• Reference Guide: Internal Revenues/Expense Recoveries
• Simulation: Enter Internal Revenues/Expense Recoveries
• GTFM Policy – Harmonized Sales Tax (HST)

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Last Updated:  December 9, 2022