How we think about e-commerce and home-based businesses
A payout isn't a sale. By the time Shopify or Amazon sends money to your bank, it has already been netted: gross sales, less platform and payment fees, less refunds, sometimes less ad spend or a held reserve. Book the deposit as revenue and three things go wrong together. Sales are understated, fees vanish from the profit and loss, and the tax return starts from the wrong number.
Much of the Tri-Cities' small-business activity happens in its suburban neighbourhoods rather than its shopping centres: a print shop in a Burke Mountain basement, boxes of stock in a Ranch Park garage, a handmade line packed at a kitchen table in Port Coquitlam. These businesses tend to grow quietly. The growth often goes unnoticed until a tax threshold has already been crossed. We set up the books so the next threshold is visible months ahead. If you're just starting out, our Coquitlam bookkeeping guide covers the basics.
What makes the books different
- Settlements broken into their parts. Each payout is split into gross sales, tax collected, marketplace and card fees, refunds, chargebacks and holds, then matched to the actual deposit. Shopify Payments, Amazon, Etsy and PayPal each report on their own timing, so every channel gets its own clearing account.
- The $30,000 line, checked monthly. Under the CRA's small-supplier rule, you have to register for GST once your taxable sales pass $30,000 in a single calendar quarter or across four consecutive quarters. Go over in a single quarter and GST applies from the very sale that took you past the line. We keep a rolling four-quarter total so registration is planned. Our note on when a home-based business needs to register for GST walks through the timing.
- PST depends on the channel. Under BC's Bulletin PST 142, when you sell through an online marketplace facilitator, the facilitator generally collects the PST on those sales, not you. Sales through your own Shopify site are a separate question and may need your own PST registration. Separately, BC's small-seller rule (Bulletin PST 003) can exempt a home-based seller from registering. Among other conditions, retail sales must be $10,000 or less over the past 12 months and expected to stay there over the next 12.
- Stock is an asset until it ships. Inventory sitting in a garage or at a fulfilment centre belongs on the balance sheet. We bring purchases and inbound freight into inventory, record cost of goods sold as orders go out, and reconcile to a count at least once a year.
What a monthly close looks like for you
Every month, on our side:
- Pull the settlement report from every channel and tie it to the bank deposits
- Post sales, fees, refunds and chargebacks to separate accounts instead of a single net figure
- Reconcile the bank, credit cards and PayPal
- Update inventory and cost of goods sold from supplier invoices and the platform's order data
- Roll the four-quarter sales total forward and flag it if $30,000 is within reach
- File home-office records (utilities, internet, the share of the house used for work) in a folder for your CPA, who decides what's claimable
By the 10th you get a profit and loss by channel, a balance sheet and a short note. That's our monthly bookkeeping routine, and once you're registered, GST and PST returns come straight off the same ledger. If you've sold for a year or two without proper books, catch-up bookkeeping comes first.
Tools we commonly use for e-commerce clients
- Ledger: QuickBooks Online or Xero
- Settlements: A2X or Synder, which turn each Shopify or Amazon payout into a summarised journal entry
- Receipts: Dext for supplier bills, shipping labels and packaging orders
- Inventory: Shopify's own stock counts to begin with, and a dedicated inventory app once your SKUs multiply
Partners we work with
We refer by type, never by firm name:
- CPA firms comfortable with sole proprietors and small corporations, including the question of whether and when to incorporate
- Customs brokers, when stock comes in from overseas and duties need to land in the right account
- Insurance brokers, for stock held at home and product liability cover
A good fit if
- You sell through Shopify, Amazon, Etsy or a mix, from home or a small unit in the Tri-Cities
- Your sales are heading toward the GST threshold, or you've passed it and need the records sorted
- You want margin after fees and shipping, channel by channel, rather than one blended number