Accounting & Tax Services for E-commerce Businesses in Canada

E-commerce is the most sales-tax-complex industry in Canada

An online seller based in one Canadian province who ships to customers across Canada and into the US faces sales tax obligations that may include: federal GST/HST in every Canadian province (with HST in Ontario and the Atlantic, GST plus PST in BC/SK/MB, GST plus QST in Quebec, GST only in Alberta and territories); marketplace facilitator rules in BC, Saskatchewan, Quebec, and at the federal level (the marketplace operator may now collect and remit tax on behalf of third-party sellers); US state economic nexus thresholds (most US states now require out-of-state sellers to register and collect once specific revenue or transaction thresholds are crossed); cross-border duty and import GST handling; and platform-specific 1099-K equivalents in the US.

BOMCAS Canada specializes in the accounting and tax for Canadian-based e-commerce sellers. We handle the multi-province sales tax registration and reporting, the US economic nexus monitoring, the platform reconciliations, and the corporate or T2125 tax return.

Who we serve

• Shopify store operators (DTC brands)
• Amazon FBA sellers (Canadian and US marketplaces)
• eBay, Etsy, Walmart Marketplace sellers
• Wholesale brands with retail e-commerce side
• SaaS and digital product sellers
• Subscription box businesses
• Dropshipping operators
• Print-on-demand businesses

Multi-province sales tax — the rules in plain language

• Shipping to Ontario, NB, NS, PEI, NL. Charge HST at 13% (Ontario) or 15% (Atlantic).
• Shipping to BC. Charge 5% GST. Register for BC PST and charge 7% BC PST if you meet BC's remote-seller threshold (currently $10,000 of BC sales). Marketplace facilitators may collect BC PST on platform sales on your behalf.
• Shipping to Saskatchewan. Charge 5% GST. Register for SK PST and charge 6% SK PST if you have SK nexus.
• Shipping to Manitoba. Charge 5% GST. Register for MB RST and charge 7% RST if you have MB nexus.
• Shipping to Quebec. Charge 5% GST plus 9.975% QST. Register for QST with Revenu Québec separately from CRA GST.
• Shipping to Alberta, Yukon, NWT, Nunavut. Charge only 5% GST.

Marketplace facilitator rules

Starting in 2021, several Canadian jurisdictions implemented marketplace facilitator rules that shift sales tax collection from third-party sellers to the marketplace operator. Amazon, eBay, Etsy, Walmart Marketplace, and similar platforms now collect and remit certain sales taxes on behalf of sellers in specific provinces. This simplifies compliance for sellers but creates a reconciliation challenge: the platform collects on some sales but not others (e.g., on FBA sales but not on direct seller-fulfilled sales), and the seller's own books need to distinguish which transactions had platform-collected tax vs which need seller-collected tax. We handle this reconciliation monthly.

US economic nexus for Canadian sellers

Following the 2018 US Supreme Court decision in South Dakota v. Wayfair, US states have implemented economic nexus thresholds that require out-of-state sellers (including Canadian sellers) to register, collect, and remit state sales tax once specific revenue or transaction thresholds are exceeded in that state. Thresholds vary by state, commonly $100,000 in annual revenue or 200 transactions per state, with some states using different numbers. Canadian sellers crossing thresholds face US sales tax registration obligations in each triggered state. The compliance burden can be substantial. We monitor US nexus exposure and coordinate registrations through specialized tools where required.

Inventory accounting for e-commerce

E-commerce inventory accounting must reconcile: platform-side inventory snapshots (Shopify, Amazon Seller Central), third-party logistics or FBA inventory levels, in-house warehouse inventory, in-transit inventory, and returns. Cost of goods sold is calculated using a chosen costing method (FIFO is most common in Canada; LIFO is not permitted for tax purposes in Canada). End-of-year inventory valuation is one of the most material balance sheet items for e-commerce businesses and a frequent CRA audit target.

What Canadian businesses commonly miss about this service

Across the hundreds of Canadian businesses we work with, the same handful of issues come up repeatedly. Many small business owners delay engaging professional accounting until a crisis: a CRA review letter, an unfiled GST/HST return demand, a denied bank loan because financial statements aren't ready, or a Notice of Reassessment that arrived weeks ago. By the time we are first contacted, the cost to fix the problem is often several times what proper ongoing accounting would have cost from the start. Proactive engagement is dramatically cheaper than reactive cleanup.

The Canadian tax landscape also changes constantly. Recent changes that affect most Canadian taxpayers include the 2023 anti-flipping rule (residential real estate sold within 365 days is automatically business income, not capital gain); the Underused Housing Tax (UHT-2900 annual filing requirement for many corporations, partnerships, and trusts holding residential property even when no tax is owing — with $5,000 to $10,000 per-property failure-to-file penalties); the Quebec QST joint registration changes since 2021; the post-2018 Tax on Split Income (TOSI) rules that effectively eliminated casual income splitting through family dividends; the post-2021 $200,000 stock option vesting limit on the 50% deduction for options granted by non-CCPCs; the CSRS 4200 Compilation Engagement standard replacing the older Notice to Reader engagement; and ongoing CRA increased scrutiny on pre-construction assignments, short-term rental businesses, and cash businesses.

How BOMCAS Canada delivers this service

Every engagement begins with a written, fixed-fee engagement letter signed before any work is performed. The engagement letter describes exactly what is in scope, what deliverables you will receive, when those deliverables are due, what your monthly or project fee is, and what (if anything) is outside scope. This eliminates the hourly-billing surprise that most accounting clients fear. The only time we use hourly billing is for genuinely unpredictable items such as CRA audit response or complex one-off projects — and even then we agree to a maximum cap before starting.

Once the engagement letter is signed, you e-sign the CRA authorization (RC59 for businesses or AUT-01 for individuals), and we onboard you to the encrypted client portal with multi-factor authentication. All document exchange flows through the portal — no emailing of sensitive financial documents. Meetings happen by video conference or phone at times that work for you, including outside normal business hours when needed.

Our Canadian tax compliance philosophy

BOMCAS Canada is structured around four operating principles:

1. Tell the truth. If a tax position is aggressive, we say so. If a deduction will not survive a CRA review, we say so. If the engagement is going to cost more than originally quoted because the scope changed, we say so before doing the work.
2. Bill what we said we would bill. No surprise invoices. No scope-creep billing. If something legitimately changes scope, we discuss it and re-quote before doing the additional work.
3. Answer the phone. One-business-day response standard on client communications during normal business hours. No voicemail backlogs.
4. Specialize. Canadian tax and accounting is too complex to be a generalist. We do not do US-only tax, UK tax, or any other foreign jurisdiction in isolation. We are Canadian. Our cross-border work is always anchored by deep Canadian compliance.

What ongoing engagement with BOMCAS Canada looks like

For most clients, the ongoing relationship is structured around predictable monthly deliverables. For an incorporated small business client, that typically includes: monthly cloud bookkeeping with full bank and credit card reconciliation; quarterly or annual GST/HST returns prepared and filed; monthly payroll for owner-managers and any employees, with CRA source deduction remittances; year-end Compilation Engagement (CSRS 4200) financial statements; T2 corporate income tax return; owner-manager T1 personal tax return (and spouse where applicable); annual salary-vs-dividend optimization with written recommendation; unlimited email and phone support during business hours; one quarterly check-in call to review numbers and discuss the business; and CRA correspondence handling for routine review letters.

For a personal tax client, the ongoing engagement includes: annual T1 preparation; any required Quebec TP-1 (for Quebec residents); CRA pre-assessment and post-assessment review response when CRA requests additional documentation; Notice of Assessment reconciliation; and proactive tax planning conversations during the year about RRSP, TFSA, and FHSA contributions, major life events (marriage, kids, retirement, real estate), and any planned business or investment changes.

Frequently asked questions about engaging BOMCAS Canada

Why Canadian businesses choose specialized accounting over generalist accounting

The Canadian tax and accounting landscape has become significantly more complex over the past decade. The 2018 TOSI rules, the 2021 changes to stock option taxation, the 2022 mandatory reporting changes for trusts, the 2023 anti-flipping rule, the Underused Housing Tax, the changes to the small business deduction phase-out for passive investment income, the new CSRS 4200 Compilation Engagement standard, the continued expansion of digital sales tax rules, and the ongoing post-COVID CRA focus on cash businesses and unreported income have all required accountants to specialize more deeply. A generalist firm trying to cover personal tax, corporate tax, US tax, real estate, trusts, cross-border, and every industry vertical inevitably falls behind on the depth of expertise that any one client needs.

BOMCAS Canada is structured deliberately to maintain depth: we are Canadian-only by design; we work in industries where we have genuine specialized experience; we maintain ongoing professional education in Canadian tax law; we use Canadian-experienced staff at every level; and we coordinate with specialized partners (US-licensed cross-border, legal counsel for corporate restructuring, audit-engagement licensed practitioners) where required rather than trying to handle everything in-house.

Talk to a Canadian accountant who knows your industry

Call 780-667-5250 or submit the contact form. We respond within one business day.

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