Realtor accountant in Langford
Selling real estate on the Westshore means a lot of new construction: presales in phased developments, townhouses in Happy Valley, family homes on the slopes above the city centre, and buyers moving out from Victoria for more space. The commission that comes from it is irregular, arrives gross, and is increasingly earned through a personal real estate corporation. EverStone is an accountant for realtors and a Langford small business accountant, at fixed fees, online.
Quick answer: A Langford realtor earns commission that is taxable before the splits and costs come off, charges GST on it once registered, and often owes instalments after a strong year. A personal real estate corporation, permitted in BC, moves the income into a company and adds a T2. EverStone handles the T1 or T2, GST and instalment planning at a fixed fee. A self-employed realtor’s T1 with schedules is commonly $250 to $450.
For a realtor with a PREC, bookkeeping starts from $300 a month with GST filing included. The year-end covers the T2 with Schedule 1 and Schedule 50, the small business deduction, T4 or T5 slips for your pay, and the instalments for the year ahead.
The hub for realtors, PRECs and brokers explains what makes commission income different. If you also hold a rental, accounting for real estate investors covers that side.
Commission from a market built on new homes
A resale in Colwood closes and pays on a predictable timeline. A presale in a phased Langford development can be written one year and complete the next, and the commission can arrive long after the work was done, sometimes in parts. That makes it easy to spend a strong year’s deposits before the tax on them is known, and easy to set instalments off a year that will not repeat.
Commission also lands gross. Brokerage splits, desk fees, marketing and vehicle costs come out afterwards, so the deposit is rarely the taxable figure. We match each commission statement to the deposit, record the costs as they happen, and keep a running estimate of tax owing, so the spring bill is a number you already expected.
New-build sales also bring buyers’ tax questions to your desk: GST on a new home, rebates, and assignments of a presale before completion. Those are the buyer’s or seller’s tax position, not yours, and the right answer depends on their facts. Pointing them to their own adviser, or to a summary such as the first-time home buyers’ GST rebate, keeps you out of advice you are not paid to give. Your own file is the commission, the costs and the tax on them.
Working through a personal real estate corporation
British Columbia permits realtors to earn commission through a personal real estate corporation. In a PREC the commission is earned by the company and taxed there, at the small business rate on active business income, until you pay it out as salary or dividends. That creates two things a sole proprietor does not have: a choice about how much to take each year, and the option to leave the rest in the company.
It also brings a corporate T2, separate bookkeeping and a shareholder loan account that has to be watched. Money drawn without a salary or dividend behind it is a loan, and a loan not repaid within one year after the year-end is generally taxed as your income; see shareholder loans. A PREC pays off when you earn more than you spend; if you spend it all, the advantage narrows. See accounting for a BC personal real estate corporation and the salary-versus-dividends calculator.
GST on commission
Real estate commission is a taxable supply for GST. Once your taxable revenue passes $30,000 in four consecutive calendar quarters, registration is mandatory, and many realtors cross it in their first good year. After that you charge 5% GST on commission, file the GST34 return on your assigned period, and claim input tax credits on business costs such as marketing, photography and the vehicle’s business share.
The brokerage does not handle this for you. Registration timing, filing frequency and the credits are yours to manage. A first-year realtor who registers late can owe GST on commission that was never collected from the brokerage. GST and BC PST are separate taxes, and PST rarely touches a real estate practice except on some purchases.
Instalments after a strong year
Nothing is withheld from commission. When net tax owing is more than $3,000 in the current year and in either of the two previous years, the CRA expects instalments on March 15, June 15, September 15 and December 15. The reminder the CRA sends is based on past years, so a growing practice can pay exactly what was asked and still owe interest. Setting aside a share of each commission as it arrives is the simplest fix. The instalment calculator shows the amounts.
Vehicle, home office and marketing claims
A Westshore practice covers a lot of road: showings from Metchosin to View Royal, presale centres around Langford, and clients relocating from Victoria. The business-use share of the vehicle is usually the largest claim, and it rests on a log. A home office counts where it is your principal place of business or used regularly to meet clients; a desk at the brokerage weakens that claim without always ending it.
Marketing such as listing photography, staging, signage and advertising is ordinarily deductible when it is spent to earn commission. Client entertainment is restricted, and personal grooming or wardrobe generally is not deductible. Keep each invoice with the listing it relates to. The vehicle log covers the mileage side, and the guides to vehicle deductions and advertising and promotion set out what qualifies.
What EverStone handles for you
One CPA, one fixed fee agreed up front:
- T1 with T2125 for an unincorporated realtor, or T2 and statements for a PREC
- Commission statements matched to deposits each month
- GST registration, GST34 filings and input tax credits
- Instalments planned against real commission timing
- Vehicle, home office and marketing claims supported properly
- Salary-versus-dividend mix set each year for a PREC
Fixed fees, fully online
EverStone is an Abbotsford CPA firm working with Langford realtors entirely online: video, a secure upload link and e-signature, on Pacific time. For a practice run between showings and presale appointments, not having to be somewhere at a set hour is usually the point. The fee is fixed and agreed before work starts. See what it costs.
Written and reviewed by a Chartered Professional Accountant at EverStone CPA, an Abbotsford CPA firm working remotely with small businesses and incorporated owners across British Columbia. Updated . About the firm · Send an enquiry
What a realtor has to get right
| Item | Why it matters |
|---|---|
| Commission income | Recognised on its own timing, which rarely matches when the cheque clears |
| Personal real estate corporation | A PREC changes which return the income lands on |
| Vehicle and promotion costs | Among the most commonly reviewed deductions in this industry |
| GST on commissions | Commission income is taxable, so the registration threshold arrives quickly |
| Sales tax where you operate | 5% GST plus 7% BC PST: two registrations, two returns |
Source: Real estate professional accounting. General information, not advice.
Langford accounting for realtors and personal real estate corporations FAQ
Should I incorporate as a PREC?+
Do I charge GST on my Langford commissions?+
Why is my tax bill larger than I expected?+
When is commission on a presale taxed?+
What does an accountant cost for a Langford realtor?+
Do you work with businesses outside Langford itself?+
Related services and local guides
Nearby cities, the rest of what we do for Langford businesses, and the reference pages behind this one.
Selling real estate in Langford?
One CPA for your commission, GST, PREC and planning. Fixed fee, fully online. Send an enquiry.
Remote accounting for realtors from Abbotsford
EverStone works with Langford realtors virtually, from a base in Abbotsford. There is no Langford office, and nobody on the ground on the Island. Meetings happen by video and paperwork moves by secure upload link and e-signature. Commission timing, the PREC question and expense records are handled together, because in practice they are one decision.
