Tech startup accountant in Vancouver

For a one-owner Vancouver tech startup, monthly bookkeeping, payroll and the year-end T2 with statements usually cost from $500 to $700 a month all-in. The year-end covers the T2 with Schedule 1 and Schedule 50, the CCA schedule, the small business deduction, T4 or T5 slips for the owner’s pay, and the instalments for the year ahead.

Founders who have not yet incorporated can start with incorporating versus staying a sole proprietor in BC. For the national rules on first filings, see the starting a business hub.

A research claim that pays in a loss year

Most Vancouver startups lose money on purpose for two or three years, the stage the federal research program targets. A CCPC files its claim on Form T661 and can earn an enhanced refundable credit: cash now, not a carry-forward. BC runs its own research credit on the same work, so one set of project records feeds both.

The write-up gets attention; the financials set the size: which engineers worked on which uncertainty, for how long, at what salary. Project codes and a simple timesheet in the monthly books turn year-end into extraction. The expenditure limit update explains the cap on the enhanced rate.

When the money comes from more than one place

Seed money, grants and a university partnership can land in one year; label each on arrival. Research-related assistance generally reduces the SR&ED expenditure base, so a grant booked as revenue inflates the claim. Equity does not affect the base, but a convertible note or SAFE has its own accounting and shows on the balance sheet investors read.

Register each source, amount, project, period and repayment condition. Minutes a month now saves a painful review, and investors and lenders will ask. The Vancouver fractional CFO page covers board packs.

BC PST on software, and GST on everything else

BC is one of the few provinces where a software company deals with a provincial sales tax as well as a federal one. PST at 7% applies to software sold to BC customers, including many subscription and downloaded products, and a Vancouver seller of software generally has to register and collect it. GST at 5% applies separately, with its own registration once taxable sales pass $30,000 in four consecutive calendar quarters. Many exports of services and intangibles to non-residents are zero-rated for GST.

Two taxes mean two returns, two sets of rules and two places a billing system can be wrong. Tag every customer by location in the subscription platform from day one. The BC PST guide sets out what is taxable, and GST filing in Vancouver covers the federal side.

Paying founders and early staff

Founders often take little pay until a round closes, then switch to salary. Salary for qualifying development time can enter the SR&ED wage base; dividends never do. Salary brings payroll: CPP, EI, source deductions and a T4 by the end of February, plus WorkSafeBC and, past the exemption, the BC Employer Health Tax.

Early hires usually get options instead of market pay. In a CCPC, the option benefit is generally taxed when the employee sells the shares rather than at exercise, and it is reported on the T4 for that year. Keep a clean record of each grant, exercise price and exercise date. A founder advance or an expense paid personally belongs on a shareholder loan tracker, because a balance owed to the company and not repaid within one year after its year-end is generally taxed as income.

Year-end when a raise is coming

A priced round brings due diligence, and due diligence reads the financial statements. Revenue recognition on annual subscriptions, deferred revenue, capitalized development costs and the SR&ED receivable all need to be right before an investor sees them. A startup that closes its books monthly can answer data-room questions in days. One that closes once a year spends the raise fixing history. See financial statements in Vancouver. That year-end review is part of the startup accounting services Vancouver companies need before a priced round, alongside the research claim and the T2.

What EverStone handles for you

One firm, one fixed fee agreed up front:

• T2 corporate return with Form T661 and the SR&ED schedules
• Project coding and time tracking for the research claim
• Grant and funding register kept current
• GST and BC PST registration and filings
• Founder pay, payroll and stock option records
• Monthly close and investor-ready statements

Fixed fees, fully online

Monthly bookkeeping starts from $325 a month with GST filing included. Fractional CFO support starts from $2,750 a month. The research claim and the T2 are quoted after we review your enquiry. See what it costs.

Remote startup accounting

EverStone is a CPA firm serving Vancouver owners online. There is no Vancouver office and no local staff. Meetings are by video or phone, documents come through a secure upload link and are e-signed, and no visit is needed. Founders looking for a CPA for startup Lower Mainland companies get the research claim, the funding register and both sales taxes kept in one monthly file.