Record a GST/HST refund from the CRA

A refund cheque from the CRA is not income. It settles a balance your books are already carrying, so it clears your sales-tax account instead of adding revenue. Booking it as revenue overstates your sales and inflates the profit you pay tax on.

The refund arrived on your bank feed or statement

When the deposit is already sitting in Ledger › Banking › Transactions, record it from the line itself:

Mark the period as filed first (see the next section). The refund clears a receivable that filing creates, so an unfiled period has nothing to clear.
Open the deposit's details with the arrow at the right of the row, and look under "Not what it looks like?".
Click Tax refund, pick the filed period the cheque settles, choose GST/HST or QST, and confirm.

TALISK_HQ posts the refund entry (a debit to that bank account, a credit to the sales-tax account), links it to the period, and the line reads tax refund instead of sitting uncategorized. If you had already recorded the refund from the Tax Summary at the same amount, the entry is linked to the bank line rather than posted twice. The Undo tax refund control in the same panel reverses it.

A refund on a return you filed

Go to Ledger › Reports › Tax Summary and set the period picker to the filing period.
Click Mark as Filed. You can save the CRA confirmation number, and leaving the lock checkbox on prevents backdated changes to the period.
Marking it filed posts the remittance entry, which moves the period's collected tax and input tax credits into GST/HST Payable (net), account 2110. In a refund position that leaves a receivable sitting there.
The green Filed banner now shows, with an amber "GST/HST unpaid" pill. Click Record payment / refund at the right of that banner.
The dialog opens on "refund" automatically when the period's net is negative. Enter the amount and the date the money hit your bank.

The entry posted is a debit to your bank and a credit to 2110, which clears the receivable. The same button sits on every row of Filing History if the period was filed a while ago.

An overpayment with no return behind it

Sometimes the cheque is not a refund on a return at all: an instalment overshoot, a double remittance, or a reassessment in your favour. Your payment already pushed 2110 past zero, so there is no filing period to record it against.

Post it by hand instead. Go to Ledger › Accounting › Journal Entries, click New Entry, and debit your bank account with an offsetting credit to GST/HST Payable (net). That clears the balance the over-remittance left behind.

Do not categorize the deposit

Use the Tax refund action on the bank line, or record it from the Tax Summary. Do not code the deposit to a category.

Bank categorization deliberately offers expense accounts, capital assets, owner and shareholder accounts, and prepaid balances. It does not offer the sales-tax accounts, so you will not find 2110 in the list. Worse, a number the category resolver does not accept falls back silently and the deposit ends up credited to revenue, which is the exact error this article exists to prevent.

Interest and offsets

Two things make the cheque a different size from the refund, and neither is handled by the flow above:

The CRA paid you interest. The refund portion clears 2110; the interest is income and belongs in an interest income account. Split it across two lines in a manual entry. The Banking line's Tax refund action refuses a deposit whose amount differs from the recorded refund for the same reason: the difference needs its own line, not a silent merge.
The CRA kept part of it. They routinely net a GST refund against payroll or corporate tax arrears. A smaller cheque is not a write-off, it is a payment against that other liability, and it needs its own line.

TALISK_HQ produces the figure and the worksheet. Whether a refund is correct, and how a reassessment should be treated, is a question for your accountant.