Toronto and Vancouver are Canada's two biggest business hubs, and their small businesses have a lot in common: the same CRA, the same federal payroll rules and the same T2 corporate return. But day-to-day bookkeeping differs more than you might expect, mainly because of sales tax.
Here's how bookkeeping services in Toronto and Vancouver differ, and what to look for in a provider in either city.
What's the same in both cities
Whether you're in Ontario or British Columbia, your bookkeeping needs to cover:
- Recording and categorizing every transaction
- Monthly bank and credit card reconciliations
- Accounts payable and receivable
- Payroll records and CPP, EI and income tax remittances to the CRA
- T4 slips by the end of February
- Records kept for six years, as the CRA generally requires
- Year-end preparation for your T2 (corporations) or T1 (sole proprietors)
Sales tax: the biggest difference
Toronto: one tax, one return
Ontario uses the Harmonized Sales Tax (HST) at 13%, which combines the federal and provincial portions. You register once with the CRA, charge one rate on most taxable supplies and file one return. Your bookkeeping tracks HST collected and the input tax credits (ITCs) you can claim on purchases.
Vancouver: two taxes, two systems
British Columbia charges 5% GST plus 7% PST on many goods and some services. GST is administered by the CRA; PST is administered by the province. That means:
- Two registrations, two account numbers and two sets of returns
- Different rules for what's taxable under each
- No input tax credits for PST — unlike GST, PST paid on business purchases generally can't be recovered the same way
A Vancouver bookkeeper needs to track the two taxes separately and accurately. For more on federal sales tax, see our HST/GST services.
Payroll considerations
Both provinces have an employer health tax that applies once payroll passes an exemption threshold, and both require workers' compensation coverage in many industries — WSIB in Ontario and WorkSafeBC in British Columbia. Provincial employment standards — vacation pay, statutory holidays and overtime — also differ, and payroll records need to reflect the right rules.
Industry differences
Toronto small businesses span professional services, retail, hospitality, real estate, technology and healthcare. Many need bookkeeping that supports lenders' and investors' requests for year-end statements.
Vancouver businesses often work in technology, film and television production, real estate and international trade. Foreign-currency transactions are common, so bookkeeping must record exchange rates consistently and reconcile foreign-currency accounts.
What to look for in a bookkeeping provider
In Toronto
- Strong HST bookkeeping and ITC documentation
- Ontario payroll knowledge, including the Employer Health Tax
- Experience preparing year-end files for your accountant or for compilation engagements
- Capacity to keep up as transaction volumes grow
In Vancouver
- Confidence managing both GST and PST
- Multi-currency accounting experience
- Familiarity with project-based industries such as film and construction
- Cloud-based processes for businesses that operate across time zones
In both
- A consistent team that learns your business
- Work inside your existing software, such as QuickBooks or Xero
- Clear monthly deliverables and deadlines
- Documented data security
Local or outsourced bookkeeping?
You don't need a bookkeeper down the street. Most bookkeeping now happens in cloud software, so an outsourced bookkeeping provider can serve Toronto and Vancouver businesses equally well — provided it understands each province's rules. Outsourcing also gives you a team rather than a single person, which means continuity when someone is away.
Bookkeeping in Toronto and Vancouver with ADYZER
ADYZER's outsourced bookkeeping service keeps Canadian businesses' books current every month. Our team works with Toronto businesses on HST, payroll and year-end, and with Vancouver businesses on GST/PST compliance and multi-currency accounting. When you need more than bookkeeping, our outsourced accounting team adds month-end close, reporting and tax preparation.
Contact us for a quote, wherever your business is based.