Bookkeeping for Kelowna businesses

Two tax accounts, and only one of them comes back

The most common error in a BC ledger is treating PST like GST. GST paid on a business purchase belongs in a receivable account because it is claimed back as an input tax credit on the next return. PST paid on the same invoice does not come back. It belongs in the cost of whatever was bought: the equipment, the supplies, the software. When a bookkeeper posts both taxes to one “sales tax” account, the GST return overclaims, expenses are understated, and the balance sheet carries an asset that does not exist.

The fix is set up once. Supplier bills are coded so the GST lands in its own account and the PST stays with the expense, and the chart of accounts carries separate liability accounts for GST collected and PST collected. That way each return is prepared from its own ledger balance rather than reconstructed from sales reports. The BC PST guide covers which purchases and sales PST reaches.

Sales that carry different tax on the same receipt

Many Kelowna businesses sell a mix. A restaurant bill charges GST on the meal but PST only on the wine and beer. A winery’s tasting room sells taxable bottles alongside tasting fees, glassware and event tickets, each of which needs a decision. A contractor’s invoice may cover labour and installed materials on which the contractor has already paid PST to the supplier. The point-of-sale or invoicing system decides what tax is charged, but the ledger has to record it by type, or the PST return ends up being a guess based on a total.

We map every sales category in your system to its tax treatment when we take the file on, then test it against the first few months of returns. Getting the mapping right once costs less than correcting it after an audit letter arrives.

Deposits taken in March for work done in August

An Okanagan summer is often paid for in advance: wedding and event deposits at the wineries, group bookings at restaurants, contractor deposits before a spring start, wine-club memberships billed ahead of the shipment. A deposit is not revenue until the thing it pays for happens. Recorded as sales on receipt, it makes the spring look profitable and the summer look weak, and it can put GST on the wrong return.

We hold deposits in a liability account and release them when the event, the job or the shipment happens. The monthly profit then tells you something true about the month.

Stock that is counted, not assumed

Wine in barrel, bottled cases in the cellar, a restaurant’s liquor room and a contractor’s material on hand all sit on the balance sheet until they are sold or used. Inventory taken from a purchase report rather than a count drifts further from reality every month. We set a counting schedule that suits the business, with high-value items counted more often, and adjust the ledger to the count. The year-end count explains what the CRA expects to see.

Card deposits, platform fees and the bank that never matches sales

Card processors pay out net of fees, sometimes a day or two after the sale, and delivery and booking platforms pay out net of their commission weeks later. None of those deposits matches a day’s sales. The bookkeeping records the gross sale, the fee as an expense and the payout as a transfer, and then reconciles each processor account to zero. Done monthly, the difference is a handful of timing items. Done in April for the whole year, it is a mystery. Why reconciliation matters goes further.

Payroll entries and the employer costs behind them

A summer crew changes the payroll ledger every season. Wages, the employer share of CPP and EI, WorkSafeBC premiums and, for a larger group, the BC employer health tax are all costs that belong to the month the work was done, not the month they are paid. We record them as payroll runs, so the summer’s labour cost is visible in the summer. The Kelowna payroll page covers the remittances themselves.

Catching up after a busy season

Owners who are working seven days in July do not do bookkeeping in July, and plenty of Okanagan ledgers reach the fall several months behind. That is normal and fixable. We bring the books current oldest month first, file any late GST or PST returns, and then keep them monthly. Catch-up bookkeeping sets out how it runs.

How the ledger differs across the valley’s industries

The chart of accounts is where each Okanagan industry shows. A winery needs inventory accounts by stage, from bulk wine to bottled cases, and a clear line between the vineyard and the winemaking. A restaurant needs food, liquor and labour cost broken out so they can be read against sales every month. A contractor needs job costing, so each project’s labour and materials can be compared with what was billed. A realtor needs commission income matched to the brokerage statements and vehicle costs separated from personal ones. A tech startup needs its development salaries and contractor costs tracked by project from the first month, because that is the record an SR&ED claim is built from. Realtors and startups rarely charge PST at all; the others almost always do.

Why a Kelowna ledger does not need a Kelowna bookkeeper

Bank and card feeds arrive electronically, receipts are photographed and sent through a secure upload link, and the file sits in cloud accounting software you keep your own login to. QuickBooks or Xero both work. EverStone is a BC CPA firm in Abbotsford with no Kelowna office and no local staff. The same CPA who keeps the monthly ledger prepares the year-end from it, which is the part that removes the usual year-end clean-up bill.

Keeping the books accurately and knowing what they mean are different jobs, and it is worth being deliberate about whether books are still the binding constraint. Where a growing Okanagan business needs monthly reporting against a budget, fractional controller work is the next step, from $1,500 a month.