Updated Checked by the Tax-Services.ca editorial team How we check
Reconciliation discrepancies, meaning gaps between your books and your bank statement, almost always have a simple cause, and the fastest way to find it is to look at the size of the difference. Exactly 13% of a sale in Ontario points to HST. A number divisible by 9 points to two swapped digits. Twice an amount points to a deposit entered as an expense. Start there before you hunt through every line.
How do you find a reconciliation discrepancy?
Work from the difference, not from the top of the list. Write the gap down, then ask what kind of error could produce exactly that number. Only after that scroll the transactions.
| Pattern in the gap | Likely cause |
|---|---|
| 13% of a sale (Ontario) | HST booked in one place and missing in the other |
| Divisible by 9 (for example $27 or $450) | Two digits swapped when typing an amount |
| Exactly double one transaction | An entry posted on the wrong side, income as expense or the reverse |
| Exactly one transaction | Something missing, or entered twice |
| A few cents | Rounding on tax or a foreign currency conversion |
None of these are official rules. They’re just the patterns worth checking first.
What does a swapped-digit error look like?
Say your books show a $450 payment to a supplier, but the bank took out $540. The gap is $90, and 90 divides by 9. That’s the fingerprint. Someone typed 450 where the statement says 540, and the cure takes two minutes: find the supplier’s invoice, check the amount, fix the entry.
The trick works because swapping two digits always changes the number by a multiple of 9. It won’t catch every typo. But it’s a quick test before you spend an hour scrolling.
What does an HST gap look like on real numbers?
Suppose a customer in Ontario pays you $13,560. Your ledger shows a $12,000 sale, so the bank is $1,560 higher than the books. Is that a mistake? Not really. The HST reverse calculator confirms that $13,560 with 13% tax included is $12,000 before tax and $1,560 of HST. The books just haven’t recorded the tax owed on the sale.
The fix isn’t to bump the sale up. Split the deposit: $12,000 to revenue and $1,560 to HST collected. Then check that your invoice showed the tax on its own line. If you want to test a price the other way round, the GST and HST calculator adds the tax to a pre-tax figure.
Which timing differences aren’t errors?
Plenty of gaps fix themselves. A cheque you wrote on the 29th may clear on the 3rd. A card sale may reach your account a day or two later. These are outstanding items, and the honest way to handle them is to list them on the reconciliation and tick them off next month.
Worry when an item stays outstanding for weeks. A cheque that never clears might have been lost, or a deposit might have gone to the wrong account. Ask the payee or the bank, and write down what they say and when.
How do you fix an error without making it worse?
Don’t overwrite the original entry. Post a correcting entry with a date and a short note saying what was wrong. That leaves a trail, which matters because the CRA expects records that let it verify what you reported, and the pages we read say to keep them for six years from the end of the last tax year they relate to. The CRA’s page on keeping records is the starting point.
If the error touches tax, look wider. A wrong HST split can affect a return you’ve already filed. No official rule turned up on how quickly you must correct small bookkeeping slips, so if the amount is large, ask your accountant whether a return needs to be amended.
Habits that keep gaps small
Reconcile monthly, not once a year. A 30-day window means a mismatch is a short list. Do it in the same order every time: opening balance, deposits, payments, closing balance. If the closing figure doesn’t match, stop and find it before you post anything else.
Software that matches bank feeds automatically helps, but it also hides errors when you click accept on everything. Read the matched items that carry a large amount. You can also use the percentage calculator to check whether a gap is 13%, or some other share of a known amount.
And if you keep a separate bank account for the business, reconciliation gets much shorter, because personal spending can’t create a mystery line.
Here’s a tidy end-of-month routine. It takes about half an hour once you’re used to it.
- Download the statement and check its opening balance against last month’s closing.
- Tick off every deposit and payment that appears in both places.
- List what’s left over on each side, with dates.
- Explain each leftover as timing, a missing entry or an error.
- Post the fixes, then confirm the two closing balances agree.
Our sources
The 13% Ontario HST rate and the reverse maths come from the sales tax data behind our calculators, checked against the CRA‘s GST/HST rate page in 2026. The six-year record rule comes from the CRA’s record keeping pages. This is an independent guide, separate from any government body.
Frequently asked questions
What is a reconciliation discrepancy?
It's a difference between your books and a bank or card statement. It can be a timing item, a typing slip or a missing entry.
Why is my bank balance higher than my books on a sale?
In Ontario, check for HST. A $13,560 deposit on a $12,000 sale leaves $1,560 of tax that the ledger hasn't recorded.
How often should I reconcile?
Monthly is a good rhythm. A small window gives a short list to check.
Should I delete a wrong entry?
No. Post a correcting entry with a date and a note so the trail stays readable.
How long do I keep the reconciliation files?
The CRA's record pages say six years from the end of the last tax year they relate to.
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