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Accelerator programs don’t come with a bookkeeping rulebook of their own. Your company follows the same CRA record rules as any other Canadian business: keep the books and every supporting document for six years from the end of the last tax year they relate to. What’s different is the paperwork the program adds, such as a participation agreement, a cheque from someone, and a promise of equity, and that’s where startups tend to lose track.
What extra paperwork does an accelerator create?
Three things, mostly. There’s the agreement itself, which says what the program gives you and what it takes. There’s any money that arrives, whether it’s a grant, an investment or a stipend. And there are the receipts for what you spend it on.
File each of these under the program’s name from day one. When you’re asked later where $25,000 came from, you want one folder, not a hunt through email. No official CRA page we found treats accelerator money as its own category, so how a payment is taxed depends on its terms. Read the agreement and ask an accountant before you decide whether a payment is income, a loan or a share purchase.
| What arrives | What to file |
|---|---|
| Cash for equity | Signed agreement, share or note records, bank proof |
| Grant or stipend | Award letter, conditions, spending receipts |
| Loan | Signed terms, repayment schedule, statements |
| Free services or credits | Written list of what was offered and its stated value |
That table is our checklist, not a CRA rule. Use it as a starting point.
How should a new company keep its books?
Open a business bank account before the first payment lands. Mixing founder money with company money is the fastest way to create a mess that costs hours to untangle. Then record every sale, expense and payment as it happens, with an invoice or receipt attached.
If you sell to customers in Ontario, charge and record HST at 13%. On a $12,000 contract, the GST and HST calculator shows $1,560.00 of tax and a $13,560.00 total. Book the two amounts on separate lines. The current threshold below which a small supplier need not register isn’t confirmed here, so check the CRA page before you decide either way.
What does a typical month look like?
Short and boring, which is the goal. Meet Noor, who joined a cohort in Vancouver with two co-founders. Every Friday she drops receipts into the shared folder. Once a month she matches the bank statement line by line, tags anything linked to the program, and writes one sentence beside anything odd. It takes her about an hour. When the program asked for a spending summary at demo day, she exported it in ten minutes.
That routine beats any software feature. Whatever tool you use, the habit is what keeps the books honest.
What happens when you pay the founders?
Salary means payroll, and payroll means remittances. A $2,000 pay cheque in Ontario carries $156.63 of employer CPP and EI on top, according to the payroll remittance calculator on its default settings. Many early teams pay founders through dividends or not at all, and that’s a legitimate choice with its own trade-offs, so have a proper conversation with an accountant before the first pay day. Someone who’s a shareholder but does real work may also count as an employee, so don’t guess.
If you do pay contractors, the CRA generally wants a T4A for fees above $500 in a year. Keep their invoices separate from payroll.
How much tax will the company pay?
A Canadian-controlled private corporation using the small business deduction pays a net federal rate of 9% on active business income up to $500,000, according to the CRA’s corporation tax rates page. Add Ontario and the corporate tax calculator gives a combined 11.7% for a calendar 2026 year. On $100,000 of profit that’s $11,696.00, leaving $88,304.00 in the company. That blend reflects Ontario’s July 2026 change, so a company with another year end will see a different rate.
Not every startup makes a profit, of course. Many lose money for years, and that’s fine, but you still file a return.
What should you do before demo day?
Tidy up. Investors who meet you at the end of a program often ask for the books within a week, and a cohort’s worth of promises is easier to explain when the folder is already in order. Reconcile the last month, list every agreement signed, and write a one-page summary of cash in, cash out and what’s still owed to anyone.
Mistakes that hurt later
- Recording an investment as revenue, which inflates your sales.
- Losing the agreement that explains a payment.
- Skipping year-end bookkeeping because there was little activity.
- Spending program money on personal costs.
Small errors compound. Reconcile every month, and put a note beside any entry that isn’t obvious. Six months on, you won’t remember why $4,000 came in.
What this page is based on
The federal 9% and 15% corporate rates come from the CRA‘s corporate tax rates page, and the $500,000 limit is the figure most provinces use there. The Ontario blend is calculated from the 2026 provincial rate change and isn’t a published rate. Payroll and HST figures come from the 2026 data behind our calculators. This is an independent guide, separate from any government body.
Frequently asked questions
Do accelerator programs have special bookkeeping rules?
We found no official CRA rule written for them. Your company follows the normal record rules, including six years of retention.
Is accelerator money taxable?
That depends on its terms: equity, grant, loan or stipend. We couldn't confirm one answer, so read the agreement and ask an accountant.
Do I need a separate bank account?
Yes, it's the simplest way to keep company money apart from your own.
Should I charge HST as a startup?
Check the CRA's small supplier rules before deciding. We couldn't confirm the current threshold.
What's the tax rate on a small company's first $500,000?
Federally 9% for a qualifying Canadian-controlled private corporation. In Ontario the calculator shows 11.7% combined for calendar 2026.
- Self-employed taxes in Canada: income, CPP and GST
How tax works when you are self-employed in Canada: reporting income and expenses, paying both halves of CPP, instalments and when to register for GST