In the ever-evolving eCommerce world, proper bookkeeping is important for success. As we move through 2025, Canadian eCommerce businesses must remain informed and up to date with increasing regulations, innovation of technology, and best practices in order to be financially healthy and compliant. This guide provides more than 1,000 words of practical yet practical insights, of research, legal cites and the expert advice to empower your business.
The Digital Services Tax Act, effective from June 28, 2024, imposes a 3% tax on revenues from Canadian digital services. Applicable to firms with global revenues exceeding €750 million and Canadian digital services revenues over $10 million, this tax affects online marketplaces, advertising, social media, and user data services.
Automation is revolutionizing bookkeeping, offering efficiency and accuracy. Services such as QuickBooks, Xero and FreshBooks are easy to use from your eCommerce platform and can automate everything from bank reconciliations, invoicing and expense tracking.
Review your processes you currently have and identify areas that can be automated.
Train your team how they should use these tools the best way so that they can benefit the most from them.
Accurate inventory tracking is vital. Methods like First-In, First-Out (FIFO) and Weighted Average Cost (WAC) are commonly used in Canada. Implementing robust inventory management systems ensures accurate financial reporting and tax compliance.
Proper cash flow management is important. Forecasting assists in predicting financial requirements to make rational decisions.
Effective internal controls protect assets and achieve integrity of finance. Using separation of duties, access controls and approval of transaction reduces risks.
Technological advancements offer tools for better financial management. Mobile accounting apps like Wave and Zoho Books provide on-the-go access to financial data.
Accrual accounting is advised for eCommerce firms as it gives a better picture of the financial state of affairs by transferring the received revenues and paid expenses only when they were incurred.
Regular reconciliation of accounts ensures consistency and accuracy in financial records. Implementing digital receipt management systems like Dext or Hubdoc can streamline this process.
Compliance with tax obligations has to be both understood and followed. Make use of automated VAT platforms that are merged with your e-commerce system to determine, collect and remit taxes correctly.
By tying sales channels to bookkeeping platforms such as A2X, Synder, or QuickBooks Commerce, managers will have unified report preparation, automatic transaction synchronization and decreased level of manual errors. According to a 2023 Deloitte study, 71% of multi-channel retailers reported significant time savings through automated integration.
The Income Tax Act (R.S.C., 1985, c. 1) requires accurate income declaration from all revenue streams–omissions can trigger audits. Proper integration ensures compliance and real-time visibility into profitability across every channel.
In eCommerce, returns and refunds are inevitable…but improperly accounted refunds can skew revenue and tax calculations. The CRA requires businesses to adjust GST/HST filings when a customer receives a partial or full refund (Excise Tax Act, Section 232).
Tools such as ReCharge or Returnly have capabilities in integrating to accounting software for this purpose of tracking liabilities of refund and inventory adjustments. According to a study by the Harvard Business Review in 2022; 20–30% of online purchases are returned, thus refund management is an important element in financial reporting.
Make some quality return workflows and connect them with your bookkeeping system right away for compliance and clarity.
