Ontario Small Business Tax and Accounting Guides
Written for incorporated owner-managed businesses in Ontario, and kept current as the rules change. Nothing is gated and nothing asks for an email address.
Contractors and trades
- When HST becomes payable on a construction contractWhen HST becomes payable on construction progress billings, how the substantial completion rule works in Ontario, and why invoicing late defers nothing.
- What a contractor's books have to track that other businesses do notHow job costing, labour burden and work in progress should be set up in an Ontario contractor's books, and what a good monthly close produces.
- T5018 filing for Ontario contractorsWho has to file a T5018, what counts as a reportable payment, when the return is due, and the three errors that cause most contractor penalties.
- Accounting for electricians in Ontario: licence costs, permits and apprentice ratiosAccounting for electricians in Ontario: what the ESA contractor licence and notification fees cost, how to code them, and the 1:1 apprentice ratio.
- Accounting for HVAC contractors in Ontario: maintenance plans, equipment and rebatesAccounting for HVAC contractors in Ontario: why maintenance plans are deferred revenue, how equipment margin differs from labour, and rebate HST.
- Accounting for plumbers in Ontario: what a call-out really earnsAccounting for plumbers in Ontario: why after-hours premiums flatter a job margin report, how to split parts from labour revenue, and what callbacks cost.
- Construction holdbacks in Ontario: HST timing, WIP, and the 2026 annual release rulesOntario's mandatory annual holdback release started January 1, 2026. When HST on a construction holdback is payable, and how holdbacks sit against WIP.
- What an hour actually costs your trades business to sellHow an Ontario contractor builds a true hourly rate: billable versus paid hours, labour burden, overhead recovery, and the arithmetic to a shop rate.
- Hiring your first apprentice: what changes and what it actually costsHiring a first apprentice in Ontario: payroll setup, remittances, WSIB, ESA vacation and holiday pay, and the real loaded cost of an apprentice hour.
- Cash flow through a seasonal year in the tradesSeasonal cash flow for Ontario trades: what to hold back from every deposit, when the HST and corporate tax land, and how a rolling 13-week view works.
- Subcontractor or employee? What decides it, and what a wrong answer costsSubcontractor or employee for Ontario contractors: how CRA decides, what unremitted CPP and EI cost the payer at 2026 rates, and how to get a ruling.
- Substantial renovation and HST, a different set of rulesWhat makes a renovation substantial for GST/HST, when self-supply applies, the housing rebates, and what an Ontario contractor must show on an invoice.
- Tools and equipment deductions for Ontario tradesHow Ontario trades deduct tools and equipment: the Class 12 threshold, CCA classes 8, 10 and 43, the half-year rule and the tradesperson's tools deduction.
- Work trucks and vans: how Ontario trades escape the $39,000 vehicle capThe 2026 passenger vehicle cap is $39,000, and the 50% and 90% hauling tests decide whether your work truck or van is capped in Class 10.1 at all.
- WSIB for Ontario trades: coverage, clearances, and the one-officer exemptionWSIB coverage is mandatory in Ontario construction. The one-officer exemption, clearance certificates, 2026 premium rates by class and reporting rules.
- The apprenticeship tax credit for Ontario employersWhat the federal apprenticeship tax credit is worth, why Ontario's own apprenticeship credit no longer applies, and how to make the claim stick.
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Clinics and wellness
- Your associate is not a contractor just because the agreement says soHow CRA decides whether an Ontario clinic associate is an employee or a contractor, what the clinic owes if it is wrong, and which structures hold up.
- The HST on your rent that you will never get backOntario clinics absorb 13% HST on rent, fit-out and equipment when their revenue is exempt. How input tax credit apportionment works and what it costs.
- Why registered massage therapy is taxable in Ontario when physiotherapy is notRegistered massage therapy is taxable at 13% in Ontario while physiotherapy is exempt. Why the rule works that way, and what it means for RMTs and clinics.
- What a multi-practitioner clinic's books actually have to trackHow a multi-practitioner clinic in Ontario should set up its books: revenue split by HST treatment, practitioner payments, and platform reconciliation.
- Which clinic services are HST exempt in Ontario, and which are notPhysiotherapy and chiropractic are HST exempt in Ontario. Massage therapy and kinesiology are not. The full list, the conditions, and the $30,000 rule.
- The psychotherapy HST exemption, and what practices that registered before it should doPsychotherapy and counselling therapy became HST exempt on June 20, 2024. What Ontario practices that registered for GST/HST before that date should do.
Med spas
- Scaling from solo injector to full med spa: the financial systems you need firstThe financial systems an Ontario injector needs before hiring: costing, cash flow, inventory control, HST setup and a compliant staffing structure.
- The real profit margins of an Ontario med spaTypical gross, net and EBITDA margin ranges for Ontario med spas, the cost lines that decide them, and practical ways to improve profitability.
- How Ontario med spas should structure MD and RN partnerships the right wayOntario med spas usually need two corporations. How the medical professional corporation and the spa corporation split revenue, and what the MSA must say.
- HST on med spa clinics in Ontario: what owners get wrong, and how to stay audit proofHow HST applies to Ontario med spas, why cosmetic treatments are taxable at 13%, and the documentation the CRA expects to accept an exempt service.
- Salary vs dividends for Ontario injectors and med spa ownersSalary or dividends for an Ontario med spa owner? How the mix affects RRSP room, CPP, mortgage approval and corporate tax, and what a hybrid looks like.
- Why most Ontario med spas have messy books: POS, gift cards and accounting chaosWhy Ontario med spa books drift out of accuracy: POS exports, merchant payouts, gift card liabilities and HST mapping, plus a six step fix that holds.
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Corporate and personal tax
- Is incorporation right for your business?What incorporation gives an Ontario business owner: the small business deduction, tax deferral, limited liability, and the costs that come with it.
- Ontario cut the small business rate to 2.2%, and the dividend credit is nextOntario's small business tax rate fell to 2.2% on July 1, 2026. How a straddle year is prorated, and why the 2027 dividend tax credit cut works against it.
- Understanding Canada's Accelerated Investment IncentiveHow the Accelerated Investment Incentive changes first-year CCA, why the available-for-use date matters more than the purchase date, and how it phases out.
- Disability-related modifications your business can deduct in fullRamps, power door openers and bathroom modifications can be deducted in full the year you pay for them instead of capitalized into the building.
- Claiming business losses: proving profit motive to the CRAWhen the CRA can deny business losses as a hobby, what the Stewart decision changed, and the documentation that establishes a genuine profit motive.
- How business loan interest deductions workWhen interest on a business loan is deductible in Canada, how the direct use test works, what mixed-use borrowing costs you, and how loan fees are treated.
- Income splitting through reasonable family salariesHow income splitting with family salaries works in Canada after the TOSI rules, what CRA treats as reasonable, and the records you need to support it.
- The essential guide to vehicle expense claims in CanadaHow to claim vehicle expenses in Canada, what a CRA mileage log needs, the passenger vehicle deduction limits, and which trucks fall outside them.
- How charitable donations reduce your tax bill in CanadaHow the charitable donation tax credit works for individuals, how corporate donations are deducted instead, and what records the CRA expects you to keep.
- Year-end business purchases and the available-for-use ruleA December purchase only reduces this year's tax if the asset is available for use before year end. Ordering it and paying for it is not enough.
- Tax instalments: how they work for you and for your corporationHow CRA tax instalments work for individuals and for corporations, when each payment is due, and why a CCPC's balance is due long before its T2 return is.
- Meals and entertainment expenses and the 50% ruleHow the 50% limit on business meals and entertainment works in Canada, the exceptions that allow a full deduction, and the matching HST credit rule.
- Deferring income and accelerating expenses: what the timing is worthWhat deferring income and accelerating expenses is actually worth, what genuinely moves under Canadian rules, and what to do in the last quarter.
- A guide to capital cost allowance (CCA)How capital cost allowance works in Canada, the common CCA classes and rates, the half-year rule, and what happens when you sell a depreciated asset.
- The home office deduction for business ownersHow the home office deduction works for unincorporated businesses, employees and owner-managers, and why the three routes are not interchangeable.
- Tax season for owner-managers: what to gather, check and fileA tax season checklist for Ontario owner-managers with a corporation and a personal return: records, deadlines, what to re-check yearly, how to amend.
- How to pay yourself: salary or dividendsHow to pay yourself salary or dividends from an Ontario corporation, the payroll and slip obligations for each, and what should decide the mix.
Bookkeeping, HST and payroll
- The six-year record rule, and how far back the CRA can actually goSix years is the record retention rule. The CRA reassessment window is a different length. Here is how both work and which records a business has to keep.
- Smart employee benefits: maximizing deductions while boosting moraleWhich employee benefits are deductible to your business and tax-free to your team, which ones CRA treats as taxable, and how to document the difference.
- Enhance employee benefits with a Health Spending AccountHow a Health Spending Account works in Canada, why reimbursements are tax-free to employees and deductible to the business, and the rules to watch.
- When should you register for GST/HST?The $30,000 small supplier threshold explained, when GST/HST registration becomes mandatory, and why registering voluntarily early is often worth it.
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