7 Bookkeeping Mistakes Montréal Businesses Should Avoid Before Filing GST/QST Returns

Accurate bookkeeping does more than keep your accounts organized. It helps your business report sales correctly, support GST/QST claims and understand how much cash is available.

For Montréal business owners, small bookkeeping errors can accumulate throughout the year. Missing invoices, duplicate expenses and incorrectly recorded tax payments can leave your financial statements and tax returns showing different figures.

Whether you operate a restaurant, retail store, consulting business or professional corporation, these seven bookkeeping mistakes deserve attention before your next GST/QST filing.

1. Treating Every Bank Deposit as Sales Revenue
A deposit into your business account is not necessarily revenue. It could represent a shareholder advance, loan proceeds, a transfer between accounts or a customer payment for an invoice already recorded.

Automatically categorizing every deposit as sales can overstate revenue and potentially duplicate sales taxes.

The opposite problem also occurs: recording a payment processor’s net deposit as the full sale can understate revenue when fees were deducted before the money reached your account.

What to do: Identify the source of each deposit and match customer payments to existing invoices where applicable. Reconcile payment processor statements to the accounting records.

2. Claiming GST/QST Without Proper Supporting Documents
A credit card statement shows that money was spent. It does not necessarily establish what was purchased, its business purpose or the taxes charged.

Revenu Québec requires supporting documents containing prescribed information to justify input tax credits and input tax refunds. The information required varies with the value of the purchase. Revenu Québec

What to do: Keep supplier invoices and receipts alongside the accounting entries. Review whether the documents contain the required information before claiming the taxes.

A useful internal rule is to investigate missing documents promptly rather than waiting until a tax review or audit.

3. Recording GST/QST Remittances as Operating Expenses
A payment of GST/QST collected from customers generally settles a tax liability. Recording it as an ordinary operating expense can distort profit and leave the sales tax accounts incorrect.

Similarly, a GST/QST refund should be matched to the relevant tax balance rather than automatically classified as sales revenue.

What to do: Record payments and refunds against the appropriate sales tax accounts. In QuickBooks Online, use the sales tax payment or refund workflow where appropriate, then match the bank-feed transaction to the existing entry.

Adding the transaction again from the bank feed can create a duplicate.

4. Assuming QuickBooks Bank Feeds Replace Reconciliations
Connecting your bank account to QuickBooks Online can reduce data entry. It does not confirm that every transaction has been recorded correctly.

Common problems include duplicate entries, missing transactions, transfers recorded as expenses and payments assigned to the wrong supplier.

An empty bank-feed inbox does not mean the accounts are reconciled.

What to do: Reconcile each bank and credit card account to its statement. Investigate differences and review excluded transactions to confirm that legitimate business activity has not been omitted.

5. Recording Restaurant Delivery Sales Using Deposits Alone
Restaurant bookkeeping becomes more complicated when sales arrive through several delivery platforms.

A platform payout may include adjustments for commissions, refunds, promotions and other charges. The amount deposited may therefore differ substantially from the underlying sales.

Example: A settlement statement shows $10,000 in customer transactions and $2,000 in deductions, leaving an $8,000 payout. Recording only the payout as sales leaves out information needed to explain both revenue and expenses.

The correct entries depend on the platform statement, agreement and applicable tax treatment.

What to do: Reconcile each platform’s settlement report to sales, related charges, taxes and deposits. Investigate differences rather than forcing the accounting records to match the bank balance.

6. Mixing Personal Purchases With Business Expenses
Personal spending through a business account makes it harder to determine the business’s actual operating costs.

It can also lead to incorrect expense deductions or GST/QST claims if transactions are accepted without review.

What to do: Maintain separate business accounts where practical. Identify personal transactions promptly and record them appropriately.

For mixed-use purchases, document the business portion and the basis for the allocation. A purchase paid by the business is not automatically an eligible business expense or recoverable sales tax amount.

7. Leaving GST/QST Preparation Until the Filing Deadline
Preparing a return at the last minute leaves little time to obtain missing invoices, correct duplicate entries or explain unusual balances.

Revenu Québec assigns businesses a monthly, quarterly or annual filing frequency. Your business should follow its assigned reporting schedule and applicable payment deadlines. Revenu Québec

What to do: Establish an internal bookkeeping deadline before the statutory filing deadline. This creates time for review, corrections and payment arrangements within your business.

Assign responsibility for preparing, reviewing, filing and paying the return. Keep the filing confirmation and verify that the payment was processed.

A Monthly Bookkeeping Checklist for Montréal Businesses
Before approving your financial reports or preparing a GST/QST return, confirm that:
- Bank and credit card accounts are reconciled.
- Sales agree with invoices, point-of-sale reports and payment processor statements.
- Supplier invoices support purchases and tax claims.
- Loan proceeds and transfers are separated from sales.
- Personal transactions have been identified.
- GST/QST payments and refunds match the tax accounts.
- Payroll entries agree with payroll reports.
- Unexplained balances and duplicate transactions have been investigated.

Regular reviews can help identify errors while the supporting information is still easy to obtain.

Frequently Asked Questions About Bookkeeping and GST/QST

Can I prepare my GST/QST return using only bank statements?
Bank statements alone may omit unpaid invoices, transaction details and supporting information required for tax claims. Your return should be prepared using complete accounting records appropriate to your reporting method and circumstances.

Does QuickBooks Online automatically make my bookkeeping accurate?
No. QuickBooks Online is a tool. Accurate reporting still depends on correct setup, transaction classification, supporting documents and reconciliations.

Should a small business review its bookkeeping every month?
A monthly review is a practical way to identify errors and monitor cash flow, even if GST/QST returns are filed quarterly or annually. The level of review should reflect the volume and complexity of your transactions.

Bookkeeping and GST/QST Services in Montréal
Reliable bookkeeping gives you a clearer picture of your business and a stronger foundation for tax compliance.

Accotec CPA helps Montréal businesses with bookkeeping, QuickBooks Online support, GST/QST reporting, payroll and corporate tax preparation.

If your records contain unexplained balances, missing transactions or sales tax differences, addressing them before filing can prevent those problems from carrying into future periods.

Visit accotecsolution.com to discuss bookkeeping and GST/QST services for your Montréal business.