In Budget 2026, the Government of British Columbia announced that several service providers will become subject to Provincial Sales Tax (PST) effective October 1, 2026. Shortly after the budget announcement, the government introduced Bill 2 – Budget Measures Implementation Act, 2026 in the BC Legislature to implement these changes.
Based on information available up until March 2026, this article outlines several practical implications for chartered professional accountants (CPAs) and accounting firms operating in British Columbia.*
Definitions
Bill 2 introduces several definitions that are central to understanding the scope of the new PST requirements.
The term "accounting services" means any of the following:
- preparing accounting records
- providing assurance services, including auditing or reviewing accounting records and accounting controls
- bookkeeping
- billing
- cost, financial, forensic, management, or tax accounting
- account reconciliation
- a service prescribed as an accounting service
It does not include services provided by a person to the person’s employer in the course of employment.
The term “accounting records” includes the following:
- financial statements and notes to financial statements
- a journal entry
- a journal of accounts
- a payroll
- a budget
- an invoice, bill, or statement of account
- a tax or information return
- any records related to a tax or information return
- an application for a tax credit, rebate, or refund
Services subject to PST
Based on these definitions, accounting firms will generally be required to charge PST on services such as:
- financial statement preparation
- assurance services (including audit and review engagements)
- preparation of income tax returns
Services that may not be subject to PST
Certain services commonly provided by CPA firms may not fall within the current definitions of “accounting services” or “accounting records.” Examples may include:
- tax planning and restructuring
- business advisory or consulting services
Firms may encounter situations where PST must be charged on some services but not others. However, the definition of accounting services includes a clause that say “a service prescribed as an accounting service,” which allows the government that ability to increase the scope of services subject to PST.
The full scope of this provision will not be known until the government releases updated PST Regulations, which is expected to occur after the enabling legislation is enacted.
Determining when to charge PST
In general, PST must be charged if the purchaser or recipient:
- resides or ordinarily resides in BC, or
- carries on business in BC
However, PST may still apply even if the purchaser does not reside or carry on business in BC when the accounting services relate to:
- real property located in BC
- tangible personal property that is, or is intended to be, ordinarily located or delivered in BC
- property or rights to use property that are owned, possessed, or used in BC
- a transaction that occurs, or is contemplated to occur, in BC
In some circumstances, it may be necessary to prorate PST where services relate partly to matters in BC and partly to matters outside the province.
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Registration requirements
Accounting firms providing taxable services will be required to register for a PST number. The government has indicated that registration will be available up to six months prior to the effective date, beginning April 1, 2026. Registration will be completed online through the eTaxBC system.
Although firms may register before October 1, 2026, PST does not need to be collected on applicable services until then.
Next steps for firms: Charging and remitting PST on accounting services
These changes will likely require adjustments to several internal processes, including:
- updating accounting and billing systems to collect PST
- modifying invoice templates
- implementing reminders for PST filing and remittance deadlines
- communicating the changes to clients so they understand the new tax requirements
Firms may also wish to consider completing and invoicing work prior to October 1, 2026, where appropriate, to avoid the application of PST on those services.
Impact on practitioners advising clients with affected businesses
The expansion of PST to additional services and products will significantly increase the number of businesses required to register, collect, and remit PST. As a result, practitioners will need to proactively identify clients who may now have PST obligations and support them through the registration process, including determining when registration is required and assisting with setup through eTaxBC.
Beyond registration, practitioners will play a key role in helping clients interpret the scope of taxable services and ensure correct application of PST. This may involve reviewing services, contracts, and billing practices to determine taxability.
Ongoing compliance will also require attention. Practitioners should be prepared to assist clients with implementing processes to track PST on sales, claim any applicable exemptions, and file returns accurately and on time. Given the potential for future regulatory changes, practitioners will need to monitor developments and update their advice as additional guidance becomes available.
Impacts on members in industry
Members working within affected businesses will need to manage the operational impact of becoming PST registrants. This includes ensuring that their systems are properly configured to calculate and collect PST on taxable transactions, and that appropriate controls are in place to capture and report the tax accurately. Changes may be required to ERP systems, billing workflows, and chart of accounts to accommodate PST tracking.
In addition, finance teams will need to establish processes for timely PST return preparation and remittance. This includes reconciling PST collected, identifying any errors or adjustments, and maintaining adequate documentation to support filings. Staff training may also be necessary to ensure that employees involved in sales, billing, and accounting understand when PST applies and how it should be handled.
*The information in this article is subject to change and will be updated as new information becomes available.
Shane Schepens, CPA, CA, is a principal at Clearline CPA and works in tax, with a focus on corporate reorganizations, estate planning, and succession planning. He helps businesses and their shareholders minimize income tax and creates business structures that are functional for both business and tax purposes. Shane has over 20 years of tax planning experience, has completed the In-Depth Tax courses, and teaches tax courses for CPABC.
