Contractor accountant in Vernon
Building in the North Okanagan means hillside lots, lakefront renovations, new subdivisions on the slopes above the city and a winter that slows site work. Each brings its own accounting: progress billings, holdbacks, subtrade slips and PST on materials. EverStone is a CPA for incorporated contractors and a Vernon small-business accountant, working remotely.
Quick answer: A Vernon construction contractor files T5018 slips for subtrade payments, checks WorkSafeBC clearance before paying subcontractors, pays PST on materials installed into real property, and remits GST on deposits as well as invoices. EverStone handles the books, the T2 and the year-end remotely. A typical contractor bundle of bookkeeping, payroll and the year-end T2 is usually $450–$650 a month.
Contractor accounting for a Vernon builder is usually $450–$650 a month for bookkeeping, payroll and the year-end T2 with statements together. The file covers T5018 information returns, the GST34 return and input tax credits, the CCA schedule for equipment, T4 slips for crews, and the small business deduction.
Progress billings and deposits
A custom home or a lakefront renovation in the North Okanagan can run for most of a year, and sometimes across two fiscal years. Revenue should follow the work done, not the invoices sent. Work completed but not yet billed is earned; a deposit taken before work starts is not. The year-end cut-off on open jobs is often the single biggest number on the return.
GST runs on a different clock. It is generally payable on the earlier of the invoice date and the date of payment, so a deposit collected in March puts GST into the company’s bank account long before the work is done. Treat that money as spendable and the next return becomes a cash problem. Setting aside the GST portion of every deposit avoids it.
Builders who construct a house to rent out, rather than sell, meet a different GST rule. Renting out a new home you built can be treated as a sale to yourself at fair market value, with GST owing on that value. The same can apply to a suite or a duplex on a lot you own. This is a question for before the foundation is poured, not after the tenant moves in.
Holdbacks sit on both sides of the ledger
BC lien rules allow an owner or general contractor to hold back part of each payment until the lien period passes. For a contractor, that means receivables include money that is earned but not yet collectible. It also means holdbacks you keep from your own subtrades are costs already incurred. Leaving either out of the books distorts the margin on the job that created them. A holdback schedule, kept by job, keeps both sides visible. The construction holdbacks guide goes further.
T5018, if you pay anyone else to do the work
A business whose main income is construction reports payments to subcontractors on T5018 slips. The return is due six months after the reporting period, and the period can be the calendar year or your fiscal year. Short engagements still count. Collecting each subtrade’s legal name, business number and address before the first payment is the difference between a quick filing and a long chase. The T5018 subcontractor tracker keeps the list, and T5018 reporting explains the rules.
WorkSafeBC, and the clearance letter
When you hire a subcontractor, you can become responsible for their unpaid WorkSafeBC premiums if they are not in good standing. A clearance letter, checked before you pay, protects you. Owner-operators working alone may not be registered at all, which is a classification question as much as a coverage one. Your own crew is reported to WorkSafeBC through payroll, under the classification for the kind of work you do. See WorkSafeBC registration.
PST on materials you install
In BC, a contractor who supplies and installs materials into real property is treated as the consumer of those materials. You pay 7% PST when you buy them and do not charge PST to the owner on the installed result. That surprises builders arriving from other provinces. It also means PST on materials is a job cost, not a tax to recover. Goods sold without installation, such as appliances dropped off at a site, can be different. The construction accounting in BC page sets out the cases.
When one general contractor supplies most of the work
Plenty of Vernon trades incorporate and then work almost entirely for one builder. If the relationship looks like employment, with set hours, supplied tools and no other clients, the CRA can treat the company as a personal services business. That removes the small business deduction and limits expenses. Taking on other clients, using your own equipment and quoting by the job all point the other way. The PSB risk assessment walks through the factors.
Winter, equipment and the slow months
Snow on the higher subdivisions slows excavation and framing for part of the year, while interior work carries on. Cash planning needs to cover the slow stretch: payroll for a reduced crew, equipment payments and instalments still come due. Excavators, skid steers and trucks go into CCA classes with their own rates. Buying before year-end gives a partial claim, and a trade-in comes out at its trade-in value. A vehicle log supports the business share of a truck. See equipment CCA classes.
Fully virtual, based in Abbotsford
EverStone is a one-CPA firm based in Abbotsford, serving Vernon contractors remotely. There is no Vernon office. Invoices, subtrade bills and receipts come through a secure upload link, job reports go out by email, and the year-end is signed electronically. One CPA holds the file, so the person who set up your job costing is the one who prepares the T2. For the trade-by-trade side, see Vernon trades accounting.
Prepared and reviewed by a Chartered Professional Accountant at EverStone CPA, an Abbotsford CPA firm working with small businesses and incorporated owners across British Columbia. Updated . About the firm · Send an enquiry
What an incorporated contractor has to get right
| Item | Why it matters |
|---|---|
| Subcontractor payments | Reported to the CRA on T5018 slips |
| Holdbacks | Recognized on their own timing, on both the receivable and payable side |
| WorkSafeBC | Clearance checked before paying each subcontractor |
| Materials installed | PST paid on purchase and treated as a job cost |
| Sales tax where you operate | 5% GST plus 7% BC PST: two registrations, two returns |
Source: Construction and trades accounting. General information, not advice.
Other services for Vernon businesses: payroll and corporate tax.
Vernon contractor questions
Do I charge PST to the owner on a renovation?+
When is GST due on a deposit?+
When are T5018 slips due?+
Do I need a WorkSafeBC clearance letter for every subtrade?+
Does EverStone have a Vernon office?+
What does an accountant cost for a Vernon contractor?+
Do you work with contractors outside Vernon itself?+
Related services and local guides
Nearby cities, the rest of what we do for Vernon businesses, and the reference pages behind this one.
Who this is for, and who it is not
This suits an incorporated builder, renovator or site contractor in the North Okanagan with crews, subtrades and jobs that run for months. You want job costing that shows which projects made money, slips and clearances handled, and the T2 done by the CPA who kept the books. A large commercial general contractor with bonding and audited statements needs a bigger firm, and we will say so. For anything short of that, the fee is agreed before work starts.
Incorporated trade in Vernon?
Get progress billings, holdbacks, T5018s and PST on materials handled by a CPA who works with builders. Email or book a free consultation.
