Month-end close: PST in British Columbia

British Columbia charges its own PST on top of GST, with a separate return in eTaxBC, and a late return loses the filing commission.

This is part of the sales tax checklist. It covers PST only, at 7% [1]. For GST, follow the Canada GST/HST steps, and for payroll and the rest of a BC close, see the BC worked example.

Rate. PST is 7%, charged on top of GST. Which of your client's sales and purchases it covers depends on their industry.

Filing. The BC government assigns the period from the PST collectable in a year: over $12,000 is monthly only, over $6,000 up to $12,000 monthly or quarterly, over $3,000 up to $6,000 quarterly or semi-annual, $3,000 or less quarterly, semi-annual or annual.

Due. On the last day of the month after the period ends, or the next business day if that falls on a weekend or a BC statutory holiday.

The trap. Filed and paid on time, your client gets a commission of up to $198 for the period. A late return loses it. PST is also owed on taxable goods bought from an out-of-province supplier that didn't charge it, so the return has a box for those purchases.

The month-end steps

The BC government assigns your client's PST reporting period based on how much PST they collect in a year [2]:

Use the period on your client's eTaxBC account.

Every month:

1. Confirm what's taxable before you check any totals. Which sales and purchases are PST-taxable depends on the industry. Read the BC PST bulletin for your client's industry, listed under "Industry specific" on the BC government's PST publications page [4]. Keep a short note in the file of which of your client's sales and purchases are taxable.
2. Check that PST charged on taxable sales and leases is posted to the PST payable account. It counts whether or not the customer has paid [3].
3. List anything your client bought for business use without paying PST, such as goods from an out-of-province supplier that didn't charge it. These need to be self-assessed [3].
4. Note any PST refunded or credited to a customer, and any bad debt written off on a taxable sale. Each of these is claimed in the period it happened, or the client has to apply for a refund instead [3].

When the month ends a reporting period, prepare every box of the PST return [3]. Enter zero where nothing applies, so a blank box isn't mistaken for a skipped one:

1. Box A: total sales and leases, excluding PST and GST.
2. Box B: PST collectable on sales and leases.
3. Box C: commission, worked out on the return.
4. Box D: net PST due on sales and leases, which is Box B minus Box C.
5. Box E: the cost of taxable goods, software and services bought without paying PST.
6. Box F: PST due on Box E.
7. Box G: PST payable before adjustments, which is Box D plus Box F.
8. Box H: PST on bad debts written off this period.
9. Box I: PST refunded or credited to customers this period.
10. Box J: total adjustments.

The amount owing is Box G minus Box J [3]. The return and payment are due on the last day of the month after the period ends, or the next business day if that falls on a weekend or a BC statutory holiday [2]. Your client can file and pay in eTaxBC. If the return is filed and paid on time, your client gets a commission of up to $198 for the period [2]. A late return loses it.

For your own practice: the BC government has paused the planned extension of PST to accounting services [2].

Done when the PST payable account ties to the month's PST report. At a period end, Boxes B and F must tie to it, and the working papers are saved.