Donate goods > RM500 to charitable organization without benefits in return, how to handle the GST treatment?
Company donated goods exceed RM500 to a charitable organization without any benefits in return, however a sales tax invoice was generated from the accounting system due to withdrawal of physical inventory and sales order creation to recognize the outward delivery of goods with tax code “DS”. In the AR ledger, the charitable organization shown an outstanding balance hence need to credit out. Please advise how to do and not impacting the GST.
How do we accountable for the GST for “DS” since the GST for journal reclass to donation is “OP” = zero value? Tax invoice issued for the donation was RM1460 inclusive GST under tax code “DS” – DR AR $1460 CR Sales $1377.36 CR Output Tax $82.64.