Trades accountant in Langford

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.

Two kinds of customer

New-build work for a builder runs on contracts, progress invoices and holdback, with payment on the builder’s schedule rather than yours. Service work for a homeowner in Colwood or View Royal runs on a ticket, a card payment and a warranty visit later. The two belong in different revenue accounts, because their margins, payment timing and collection risk are nothing alike.

Mixed together, they hide which half of the business actually pays. A trades owner who sees that service work earns more per hour than the new-build contract, or the reverse, can price the next bid differently. The margin analysis page shows how that comparison is built.

Commercial fit-outs and the building season

A third stream of work comes from the restaurants and shops opening in the city centre and along the highway corridor. A fit-out runs on a contract with a tenant or a landlord, sometimes with a general contractor in between, and the invoice has to name the right party. Owners on the other side of those jobs have their own pages: restaurant accounting in Langford and retail accounting in Langford.

All three streams follow the weather to some degree. Exterior and new-build work slows in the wettest months while service work picks up, so revenue shifts rather than stops. An annual GST filer with a strong summer can find most of the year’s tax due in one payment, which is why the GST collected should be moved aside as it is invoiced. Managing a seasonal business covers the cash side.

PST on parts and materials

When you supply and install materials into a building, such as wiring, fixtures, ductwork or drywall, you are generally the consumer of those materials for BC PST. You pay 7% PST when you buy them and do not charge PST on the job. That PST is a cost of the job, not a recoverable tax, and it should be coded that way.

Repairs to goods are different. Fixing an appliance or a piece of equipment, as opposed to working on the building itself, can be a taxable service for PST, and parts sold over the counter are taxable sales. A trades business that does both kinds of work may need a PST registration it never thought about. See the BC PST guide, and keep GST separate: it is charged on both kinds of work, and the GST you pay on materials comes back as input tax credits.

Vans, trucks and the Westshore drive

A Westshore trade spends a lot of the day in the vehicle: up the hill to a Westhills site, along Highway 14 to a job in Sooke, back down the Trans-Canada to a supplier. The business-use share of a work truck or van is deductible, and the claim rests on a log of trips. Without one, the deduction is hard to defend if the return is reviewed.

A vehicle owned by the corporation and used personally also creates a taxable benefit for the owner. A vehicle owned personally and used for work is reimbursed by the company at a reasonable per-kilometre allowance instead. Choose one approach and record it. The vehicle log and the vehicle benefit calculator cover both sides.

One builder, most of your revenue

An incorporated electrician or plumber who works almost entirely for one Langford builder fits the fact pattern of the personal services business rules. If you would reasonably be considered that builder’s employee had your corporation not existed, the corporation can lose the small business deduction and most of its deductions. Your own tools and vehicle, your own insurance, more than one real customer and the right to send someone else all weigh against it. The PSB risk assessment walks through the factors, and keeping some homeowner service work on the books is often the most practical protection.

Subtrade slips and apprentices

If construction is your main activity and you pay other trades, T5018 slips report those payments, due six months after the reporting period. Apprentices and helpers are a different matter: most are employees, which means payroll with CPP, EI premiums and income tax withheld, WorkSafeBC reporting, 4% vacation pay and a T4 by the last day of February. Paying a helper as a “subcontractor” because it is simpler does not change what they are. See subcontractor or employee and payroll in Langford.

What is covered

One Chartered Professional Accountant handles the whole file:

• Builder and homeowner revenue tracked separately, with holdbacks scheduled
• PST on installed materials coded as job cost, and PST registration reviewed
• GST returns with input tax credits on materials and tools
• Vehicle logs, CCA on trucks and tools, and taxable benefits
• Payroll for apprentices and helpers, and T5018 slips where they apply
• T2 corporate return and year-end financial statements

Remote, and there is no Langford office

EverStone has one office and it is in Abbotsford, not Langford. Every engagement is delivered online: video meetings, e-signature and a secure upload link for invoices and receipts photographed in the truck. For a trade that would lose half a day to an appointment, that is a practical advantage. The same CPA prepares the return and answers questions during the year. For the provincial context, see construction accounting in BC.