Trades accountant in Courtenay

For a typical incorporated trades business in Courtenay, bookkeeping, payroll and the year-end T2 with statements usually come to $450–$650 a month all-in. A sole proprietor’s self-employed T1 with schedules is commonly $250–$450. The published fees list every starting point.

Many small invoices, paid many ways

A service trade can raise more invoices in a month than a builder raises in a year. Some are paid by card on the doorstep, some by e-transfer, some by a property manager or a strata thirty days later. Each payment route needs to land against the right invoice. Otherwise the receivables list fills with items that were paid long ago and debts that nobody is chasing.

Card payments arrive net of the processor’s fees, so the deposit is not the sale. A clearing account that takes the gross sale in and the fees and deposits out keeps it straight. When it does not return to nil, a payment has gone astray. Our guide to collecting receivables covers the follow-up side.

The van carries the business

For most trades the vehicle is the largest claim on the return. A day can start in Courtenay, cross to Comox, run out to Royston and finish back in town, and a week of that adds up. The CRA expects a log of business trips with odometer readings at the start and end of the year. A log kept for a representative period can support a steady pattern across the year.

A van fitted out for work, with racking and a ladder rack, may be treated differently from a passenger vehicle. The class it falls into changes the CCA and the limits that apply. Inside a corporation, a vehicle the owner also drives personally can create a taxable benefit. The mileage and vehicle log and the vehicle benefit calculator help with both, and company vehicle benefits explains the rules.

One licence for several Island towns

The City of Courtenay requires a business licence for every business operating in the city, including mobile and non-resident businesses, and licences run for the calendar year. For trades such as plumbers and electricians, the city offers an inter-community business licence that also covers participating municipalities including Comox, Cumberland, Campbell River, Nanaimo, Parksville and Qualicum Beach. It is an annual cost on top of the standard licence fee, and it saves holding a separate licence in each town. The fees are deductible, and the renewal belongs on the same calendar as the GST and payroll dates.

Ferry jobs and travel time

Work on Denman or Hornby Island, or a job down-Island or on the Mainland, brings ferry fares, waiting time and sometimes a night away. Fares and reasonable travel costs for a business trip are deductible. Meals on the road are generally limited to 50% of the cost. Time spent travelling is a pricing question rather than a tax one, but it should show up in the job cost so the quote for the next island job is realistic.

PST: what you install and what you sell

BC PST treats a trade in two ways. Materials you supply and install into a building, such as wiring, pipe, fixtures and ductwork, are taxed when you buy them. You pay the 7% PST and do not charge PST on the installed work. Parts and equipment sold to a customer who installs them, or sold over the counter, are different. You collect PST on those sales and file a PST return.

Repairs need care too. Fixing a building is generally not a taxable service. Repairing a customer’s equipment or appliance can be a taxable related service. A trade that does both needs its invoices coded so each line carries the right tax. The BC PST guide sets out the rules, and rates are on BC tax facts.

Apprentices, payroll and WorkSafeBC

Taking on an apprentice means running payroll properly from the first pay: CPP, EI premiums and income tax withheld and remitted, vacation pay of at least 4%, and statutory holiday pay for qualifying staff. WorkSafeBC registration and premiums follow. Final pay is due within 48 hours if the job ends.

Time spent at trade school is handled differently from time on the tools, and the records should show which is which. Payroll in Courtenay covers the employer side in full, and the first employee checklist is a good starting point.

When incorporating a trade pays

An incorporated trade pays 11% combined tax on active business income up to the business limit. That only helps on money you can leave in the company. A trade that draws everything to live on gains little from incorporating and takes on a T2, a separate bank account and more bookkeeping. One that is growing, buying equipment or hiring often gains a lot.

A trade that works almost entirely for one general contractor should also look at the personal services business rules before incorporating. Should I incorporate? walks through the decision.

How the year-end comes together

The year-end pulls the pieces into one file. The T2 and the financial statements, CCA on the van and tools, the small business deduction, T4 slips for staff and the owner, and T5 slips for any dividends. A trade that also hires subcontractors for construction work files T5018 slips. If the books were kept monthly, this is a review rather than a rebuild.

One Chartered Professional Accountant handles the whole file:

• Invoices, card settlements and receivables reconciled
• Vehicle, tools and equipment through CCA
• PST on installed materials and on parts sold
• GST returns with input tax credits reviewed
• Payroll for apprentices and journeypersons
• The T2, statements and the owner’s pay plan

Remote, and there is no Courtenay office

EverStone works online. Courtenay trades are served entirely online. Receipts can be photographed in the van and sent through a secure upload link, questions go by email first, and a video meeting is booked when it helps. The same CPA prepares the return and answers questions during the year. For the provincial picture, see construction accounting in BC.