FreshBooks B.C. PST setup for engineering: GST plus 7% on 30% (2026)

Make C$1,071 the acceptance result

For one confirmed C$1,000 taxable engineering service connected to B.C., the provincial formula produces C$21 of PST: 7% × (30% × C$1,000). If the federal facts separately support 5% GST on the full fee, the illustrative GST is C$50 and the invoice total is C$1,071.

Treat those amounts as acceptance evidence, not as a classification shortcut. A FreshBooks tax named 2.1% does not prove that the service is taxable, that GST applies, or that the customer document, accounts, reports, credit, Box A, Box B, eTaxBC return, and payment all preserve the legal split.

Confirm the engineering-service definition, B.C. connection, exemptions, resale, disbursements, allocations, collector or small-seller position, transition dates, and federal GST treatment before configuring a live service or invoice.

Create two uniquely named taxes and apply both to the line

FreshBooks says a new sales-tax rate can use up to three decimal places and that up to two existing taxes can be selected on an invoice line. Create two separate taxes with durable names such as “GST 5%” and “BC PST ENG — 7% × 30% — 2026-10-01,” then select both through Add Taxes only on a line whose treatment is supported.

Enter 5% for GST only when the federal treatment has been confirmed. Enter 2.1% for the B.C. engineering PST implementation because 7% × 30% equals 2.1% of the same fully taxable net line. The 2.1% entry is an arithmetic equivalent, not the statutory PST rate, and the combined 7.1% is not one legal tax.

FreshBooks notes that tax-name, rate, or number edits affect new documents moving forward and existing documents must be edited separately. Use dated names, preserve the 7%-on-30% workpaper, and do not silently repurpose a historical tax. Use separate classified lines or another reviewed process for exempt, mixed, allocated, credited, or transitional amounts.

Approve the actual customer PDF, not the settings screen

Section 85 of the Provincial Sales Tax Regulation requires a collector who provides an invoice and levies PST to show the tax as a separate item. FreshBooks documents that two taxes can be attached to a line, but that capability alone does not prove how the active template, language, currency, client view, or PDF will identify them.

Create a draft using a fictional test client, then preview and download the exact customer PDF. Approve the setup only if GST is separately identified when applicable, B.C. PST is separately identified, and the amounts reconcile to the net fee and total. A document that only shows “Tax C$71,” “7.1%,” or another merged amount fails this acceptance gate.

Repeat the render after any change to the tax name, number, invoice style, client language, currency, saved service, or recurring template. Preserve the approved PDF beside the setup record and legal workpaper before enabling recurring or automatic sending.

Verify separate tax accounts and run the acceptance suite

FreshBooks says each uniquely named sales tax creates a sales-tax account under the Taxes Payable parent account. Its journal-entry examples show a billed invoice posting the named tax to Taxes Payable. After the draft becomes reportable under the test workflow, inspect the Chart of Accounts and General Ledger and confirm that GST and B.C. PST remain separately named and traceable.

Run a C$1,000 baseline, a C$12,000 fee, a C$100 reversal, at least one cents-sensitive multi-line invoice, and one mixed or allocated invoice. Verify the customer PDF, invoice status, Sales Tax Summary, both tax accounts, General Ledger, and legal workpaper for each relevant case.

A C$12,000 fully taxable engineering fee produces C$252 PST and, when 5% GST is separately confirmed, C$600 GST and a C$12,852 total. A C$100 reversal with the same supported treatment should reverse C$2.10 PST and C$5 GST. Mixed work belongs on separately classified lines; two selected taxes cannot decide which work is taxable.

Use a credit note when tax must reverse

FreshBooks says sales tax can be added to credit notes, while prepayment and overpayment credits cannot carry sales tax. Its journal-entry examples show a credit note with sales tax debiting the named Taxes Payable account. Use a credit note that mirrors the original supported line and taxes when the purpose is to reverse invoiced GST and B.C. PST.

Do not use a prepayment or overpayment credit as evidence that tax was reversed merely because the customer's balance changed. Verify the C$100 test credit displays C$5 GST and C$2.10 PST, posts to the same named tax accounts, reduces the relevant Sales Tax Summary amounts, and traces to the federal and provincial return workpapers.

Credits consolidate into the client's available balance, so preserve the original invoice number, credit-note number, reason, line classification, tax names, expected entries, and actual report effect. Stop if the credit fixes Accounts Receivable but leaves either tax liability unchanged or untraceable.

Control the Sales Tax Summary basis, drafts, currency, and access

FreshBooks' Sales Tax Summary can run on Billed (accrual) or Collected (cash-based) income. Billed includes dated non-draft invoices whether paid or unpaid; Collected uses payments received in the selected range. Drafts are excluded, and only one currency can be viewed at a time. Choose the basis that matches the reviewed filing workpaper rather than whichever report total looks convenient.

Export the Sales Tax Summary for the period and reconcile each named tax to invoices and credit notes. Use the Invoice Details report with matching date and accounting-method filters to identify lines with zero tax when total billed or collected does not reconcile to taxable amounts plus taxes.

FreshBooks says Accounting features are available on trials and Plus, Premium, and Select plans. Confirm that the actual subscription and user role provide the Chart of Accounts, General Ledger, reports, bank reconciliation, and journal-entry access required by the control design before committing to the workflow.

• Record the business, subscription, user role, currency, report basis, date range, tax names, rates, setup date, and reviewer.
• Exclude drafts from acceptance totals and confirm when a test invoice becomes reportable.
• Run and save one report per currency when the business invoices in more than one currency.
• Investigate every zero-tax line and every variance between the invoice, report, tax account, and workpaper.

Bridge FreshBooks to GST/HST, Box A, Box B, and remittance

The Province's return guide says Box A includes taxable, non-taxable, and exempt Canadian sales and leases before GST and PST. Box B includes PST collectable on taxable sales and leases, including PST charged but not yet collected. Sellers of the newly taxable professional services must file and remit electronically.

For the C$1,000 acceptance transaction, the provincial workpaper should generally trace C$1,000 to the appropriate Box A population and C$21 to Box B, subject to all facts for the period. A FreshBooks report that describes C$21 as 2.1% of the full line still needs the separate legal bridge showing 7% × 30%. Reconcile invoices and credit notes to the named PST account, Sales Tax Summary, Box A and Box B workpapers, eTaxBC return, and payment confirmation.

FreshBooks currently tracks sales taxes but does not complete the external filing and remittance workflow. It also says Taxes Paid does not automatically deduct from Taxes Payable. Have the accountant or an owner with Advanced Accounting record the reviewed remittance or refund journal entry, handle the imported bank transaction under the current bank-reconciliation workflow, and reconcile the federal GST component separately. Do not claim that FreshBooks files the B.C. return or automatically nets tax paid against tax payable.

Fail closed when classification, display, reporting, or access breaks

The two-tax setup is arithmetic only. It cannot classify a service, establish the B.C. connection, choose an exemption, allocate a bundle, remove an actual-cost disbursement, decide small-seller or registration status, apply the October transition, or determine federal GST. Use separate supported lines and workpapers whenever the facts differ.

Approve the setup only after legal classification, both rates, the customer PDF, named tax accounts, larger invoice, credit note, cents, mixed-line, report-basis, currency, Box A, Box B, GST/HST, eTaxBC, journal-entry, bank, and payment tests all pass. Preserve expected and observed results, PDFs, reports, entries, corrections, reviewer, and approval date.

If FreshBooks cannot identify PST separately on the customer PDF, cannot preserve two distinct tax accounts, excludes an expected invoice or credit, lacks the required accounting access, or cannot reconcile to the filing and remittance records, pause automatic sending. Use another reviewed process and obtain current FreshBooks, bookkeeping, accounting, or provincial support. FreshBooks is a trademark of 2ndSite Inc.; Thirty North is not affiliated with or endorsed by FreshBooks.