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Gondaliya CPA

Corporate Tax Filing Experts

Tax Accountant for Mining Companies in Ontario and Across Canada

A mining company can carry a payroll, a field program and a full set of CRA obligations for ten years without ever invoicing anybody, and that single fact rearranges the whole file. There is no revenue to set costs against and no profit to shelter, so the work moves forward to the moment money is spent: each dollar has to be characterised when it is incurred, because the characterisation decides when it is ever deducted and by whom. Canadian exploration expense under ITA 66.1 accumulates in a cumulative pool you may draw on at anything up to its full balance; Canadian development expense under ITA 66.2 has a pool of its own with an annual ceiling of 30% of the balance on a declining basis. We settle field crew status on the facts of each engagement, file the T4 or T4A that answer produces, open WSIB from the first hire, keep you registered so the tax on every drill metre and charter comes back, and put machinery in Class 41 at 25% apart from vehicles in Class 10 at 30% — on AFFORDABLE flat fees.

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AFFORDABLE Mining Company Tax Accountant

Almost every rule of thumb a small corporation runs on assumes income. Match the cost to the revenue, shelter the profit, watch the small business limit. Take the revenue away for a decade and none of that has anything to do. What you have instead is an accumulating body of expenditure that must be sorted the day it arises, because the sorting, not the spending, is what determines the eventual deduction. A dollar spent finding out whether something is there and a dollar spent making a known deposit workable belong in different pools, release at different speeds, and cannot be quietly reassigned three years afterwards when somebody finally asks. The paperwork that justifies the split is made in a camp, in a season, by people who did not train as accountants — and then the season ends. Gondaliya CPA builds the file around that reality on AFFORDABLE flat fees.

We act for grassroots explorers working early-stage ground, companies advancing a single property toward a decision, contract drilling and field service corporations, and producers who still run an exploration budget alongside the operating one, right across Ontario. You get pool balances that are current rather than reconstructed, worker status conclusions written down while the crew is still on site, and input tax credits recovered every quarter instead of discovered afterwards.

Hand the compliance calendar and the ledger to us, and spend your own attention on the ground.

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Accounting That Understands How a Mining Company Actually Works

Nothing about a pre-revenue explorer looks like an ordinary small-corporation file. The payroll is real, the CRA obligations are real, the bank account empties on schedule, and the income statement shows nothing at the top. Everything of value in the file sits in how the spending was classified and whether the records that justify the classification still exist. Gondaliya CPA starts there and lets the rest of the file follow, for companies at every stage across Ontario.

💰

Pools That Accumulate and Wait

Exploration expenditure builds up in a cumulative pool under ITA 66.1 and development expenditure in a separate cumulative pool under ITA 66.2. Neither one expires while the company waits, and neither one claims itself.

🔍

The Split Is Decided in a Field Camp

What a dollar was spent to do is what puts it in one pool rather than the other. That has to be determined and documented when the cost is incurred, because years later the field paperwork is the only evidence there is.

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Registered With Nothing to Sell

An explorer registers for HST long before it has a customer. Registration is what lets the tax charged on drill metres, charters and camp accounts come back to the company instead of disappearing into the burn rate.

💵

Renunciation Moves the Deduction

Where exploration has been funded with flow-through shares, the expenditure is renounced to the investors who paid for it: they take the deduction and the company gives up its own. That trade deserves to be priced before it is signed.

Stay Compliant and Minimize Your Mining Company Tax

A company with no income still has every deadline a company with income has, and a few more besides. The returns go in on their dates, the pools carry forward at figures that can be supported, the credits are recovered inside their claim periods, and nothing is left sitting in a place a reviewer would want to open up.

📋

Where the Field Money Goes

Every invoice is coded against the activity that produced it — line cutting, geophysics, trenching, sampling, a named drill hole — rather than into one undifferentiated exploration account, because the coding is what later evidences how the expenditure was characterised. Whether a given cost belongs to Canadian exploration expense or to Canadian development expense turns on what it was actually spent to do; it is determined and written down when the cost is incurred, and the day sheets, assay certificates and charter manifests behind it are filed against the month they belong to. Amounts recoverable from a partner are carried as receivables and kept out of the pools entirely.

✅

CRA Obligations for Mining Companies

The obligations run through the quiet years as much as the busy ones. We look after HST registration maintained while there is nothing to sell, with input tax credits recovered on drill metres, charters, camp catering, fuel and assay work; the cumulative CEE pool under ITA 66.1 claimed at whatever proportion of the balance the year actually calls for, up to all of it; the cumulative CDE pool under ITA 66.2 at up to 30% on a declining basis; machinery in Class 41 at 25%, vehicles in Class 10 at 30%, small tools in Class 12 at 100% and camp structures and general equipment in Class 8 at 20%; recapture under ITA 13(1) on disposals; every field engagement judged on its own facts with the matching slip issued; WSIB from the first hire; and source deductions agreed to the PD7A.

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Year-End Deliverables for Mining Companies

At year end the corporation needs a trial balance that ties, financial statements carrying machinery at net book value, capitalised property interests and the expenditure pools shown so a reader can see what has been spent and what is still available, and a T2 with GIFI that agrees with the HST returns filed during the year. Site rehabilitation is a genuine future obligation of the company and belongs in the statements, with its tax treatment determined on the facts rather than assumed to follow the accounting. Where a lender or a partner is involved, compiled statements under CSRS 4200 come with the package.

Accounting & Tax Experts for Mining Companies

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Why Choose Our Accounting Services for Mining Companies?

1
🎯

Tax Planning — Claim Size Is a Decision

In a year with nothing to shelter, the correct CEE claim is often none of it. We model the claim against the return before it is filed, keep the first $500,000 of eventual active income inside the roughly 12.2% Ontario combined rate, and set share structure up for ITA 110.6 years ahead.

2
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Consulting — What the Season Actually Cost

Our bookkeeping reports a burn figure by program area and a runway in months, keeps partner recoveries out of the pools, and holds capitalised property interests apart from expensed field work, so you know where the season ends before it ends.

3
🛡

CRA Representation — Defending the Characterisation

When CRA asks why a cost sits in one pool rather than the other, the answer is the contemporaneous record. We assemble it, answer inside the deadlines, and pursue relief on Form RC4288 where penalties trace to an earlier error.

4
🏢

Bookkeeping — Records That Outlive the Season

ITA 230 asks for six years and a cumulative pool routinely outlives that several times over, so camp paperwork, driller day sheets and assay certificates are captured monthly and kept where they can still be produced.

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Mining Company Tax and Accounting Services in Ontario

📄

Corporate Tax Filing (T2) for Mining Companies

Professional T2 preparation for a company that may have no sales at all, with both expenditure pools carried at supportable figures, machinery in its correct class, and CRA compliance on every line.

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Bookkeeping & Accounting for Mining Companies

Field costs coded against the activity that produced them when the invoice arrives, partner recoveries kept out of the pools, and a burn figure by program area you can actually plan against.

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Payroll Services for Mining Companies

Field crew payroll run properly: each engagement judged on its own facts, WSIB opened before anybody starts, remittances agreed to the PD7A, and slips filed by the February deadline.

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GST/HST Filing for Mining Companies

AFFORDABLE HST work for a registrant with nothing to sell, recovering the tax charged on drill metres, charters, camp accounts, fuel and assay work quarter after quarter.

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Tax Planning for Mining Companies

Planning for a company whose deduction is a choice rather than a total: claim sizing in loss years, the eventual small business limit, credit determination, and share structure set up long in advance.

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Corporate Catch-Up Filing for Mining Companies

Unfiled T2 and HST years prepared oldest first, with the pools rebuilt in sequence from the field paperwork that still exists rather than guessed at from bank totals.

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CRA Audit Resolution for Mining Companies

Representation from the opening letter onward wherever the characterisation of expenditure, a credit claimed against a nil-revenue return or a capital cost allowance class is being questioned.

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CPA Financial Statements (Notice to Reader) for Mining Companies

CSRS 4200 compiled statements a lender, a partner or a buyer will accept, carrying pool balances, capitalised property interests and the site rehabilitation obligation where they can be read.

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Incorporation Services for Mining Companies

Incorporation from name search and articles through share classes and opening CRA accounts, with the section 85 rollover carrying property interests and equipment into the corporation.

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Catch-Up Bookkeeping Services for Mining Companies

Ledgers rebuilt season by season from bank statements, contractor invoices and surviving camp paperwork until the pool balances and the capital cost allowance schedules finally stand up.

🌐

US Corporation & LLC Tax Filing for Mining Companies

Canadian-side reporting where a shareholder, a director or a funding entity sits in the United States, covering amounts withheld on distributions and the disclosures the corporation owes on foreign holdings.

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Voluntary Disclosure Program for Mining Companies

Bring unreported amounts, field wages paid without slips or HST collected and never remitted forward before CRA makes contact, and have the penalties cancelled under the Voluntary Disclosures Program.

Twelve Services, Shaped Around a Pre-Revenue Exploration File

Real, practitioner-level CPA expertise for grassroots explorers, single-property developers, contract drilling and field service corporations and producers still running an exploration budget across Ontario — built for a company whose expenditure arrives years before its income does.

  • GIFI coding on Schedule 100 and Schedule 125 is set so exploration spending, any contract or service income and amounts recovered from partners stay on lines of their own, which is what lets a return reporting no sales still read correctly.
  • Canadian exploration expense under ITA 66.1 lands in a cumulative pool that carries forward untouched until you want it, and in any year you may deduct anything from none of it up to the entire balance.
  • Canadian development expense under ITA 66.2 occupies a pool of its own with an annual ceiling of 30% of the balance on a declining basis, so whatever you leave behind stays there and releases more slowly.
  • Capital cost allowance is claimed on Schedule 8, with underground and surface machinery in Class 41 at 25%, camp structures and general equipment in Class 8 at 20%, trucks and light vehicles in Class 10 at 30%, small tools in Class 12 at 100%.
  • Disposals are computed rather than assumed: where a loader or a haul truck goes out at proceeds above its undepreciated capital cost, ITA 13(1) pulls the excess back into income, and a terminal loss is claimed in the reverse case.
  • Every invoice is coded when it arrives against the activity that produced it, whether that is line cutting, geophysics, trenching, sampling or a named drill hole, because the coding is what later evidences how the expenditure was characterised.
  • Camp paperwork, driller day sheets, charter manifests and assay certificates are captured through Dext and filed against the month they belong to, so the six years ITA 230 asks for exist before anybody arrives looking for them.
  • Pool balances are maintained continuously rather than reassembled at year end, because a cumulative pool routinely outlives that six-year record period several times over and can only ever be defended by the documents that built it.
  • Amounts recoverable from a partner are carried as receivables and held out of expenditure, so the pools reflect what your own company bore rather than everything that happened to pass through its bank account in a season.
  • Monthly close reports a burn figure by program area and a runway in months, which on a $1,400,000 season is the difference between knowing where the field year stops and finding out in the second week of November.
  • Whether a driller, a field technician or a camp cook is your employee is decided on the facts of that engagement rather than on whether an invoice was issued, and the slip we file follows the answer instead of setting it.
  • Employment produces a T4 and a person genuinely carrying on their own business receives a T4A, and we record how each conclusion was reached at the time, because a crew that went home in October cannot be interviewed in April.
  • WSIB coverage is opened from the first hire rather than after the first incident, with premiums reported on assessable earnings, so an assessment does not surface years afterwards carrying interest on top of the premium itself.
  • Source deductions are remitted on schedule and agreed to the PD7A every month, because the late-remittance penalty is graduated and reaches 10%, which on $600,000 of field wages is real money to a company earning nothing.
  • T4 slips and the T4 Summary go out by the last day of February and tie back to the payroll register, and Ontario employer health tax is watched as total remuneration approaches the $1,000,000 mark.
  • Registration is what makes the input tax credit possible, so an explorer with nothing to sell registers anyway and recovers the tax charged on drill metres, charters, camp catering, fuel and assay work while revenue is still years away.
  • Registration becomes compulsory once taxable revenue passes $30,000 across four consecutive calendar quarters, but nearly every company we act for registered voluntarily long before that point, for the recovery rather than for the obligation.
  • Returns are filed on their dates even when they report no sales whatsoever, because a nil-revenue registrant claiming credits every quarter is an ordinary thing that stops looking ordinary the moment the filings go quiet.
  • Each credit is matched to the invoice supporting it and claimed inside its own period, since a credit lost to a charter invoice nobody entered is simply gone, and on a $2,300,000 program that adds up quickly.
  • Where field costs are shared with a partner we make certain the tax follows the party that actually bore the cost, so the same credit is not claimed twice or, far more commonly, claimed by nobody at all.
  • In a year with no income the right CEE claim is frequently none of it, because a deduction taken against nothing accomplishes nothing and shrinks a pool you will want later; we size the claim before the return is filed.
  • Where exploration has been funded with flow-through shares, the renounced expenditure leaves the company’s own pool and the deduction belongs to the investors, and we put that trade in front of you in numbers before it is committed to.
  • Credits may be available on qualifying exploration spending and have to be determined against the actual facts of the program rather than assumed, with the supporting records assembled while the season is still fresh in everybody’s memory.
  • Once the company does earn, the first $500,000 of active income is kept inside the roughly 12.2% Ontario combined rate rather than drifting toward the general rate or being drawn out personally at rates reaching 53.53%.
  • Share structure is put in place years ahead of any sale so the shares can qualify under ITA 110.6, where the $1.25M lifetime exemption is worth a six-figure difference to a single shareholder and cannot be arranged retroactively.
  • Unfiled T2 years are prepared oldest first so the pools rebuild in sequence, because a balance carried forward wrongly in the first year is still wrong four returns later and compounds quietly the whole way through.
  • Expenditure from the missing years is characterised from the field paperwork that survived, meaning day sheets, assay certificates and contractor invoices, rather than guessed at from bank totals that cannot tell exploration from development.
  • The missing HST returns are filed and the credits inside them recovered, which on a company that spent three seasons in the bush without filing anything regularly returns a five-figure amount the owner had written off.
  • A return filed late attracts 5% of the balance owing, then a further 1% for every complete month it remains outstanding to a twelve-month maximum, which is why the earliest year is always prepared first.
  • Payroll years are reconciled at the same time, with slips filed and remittances agreed, so a catch-up does not close one file while quietly leaving a second one open for CRA to find later.
  • When CRA asks why a cost sits in one pool rather than the other, the answer is the contemporaneous record of what the program was trying to establish at that moment, and we assemble and present precisely that.
  • Reviews of credits claimed against a nil-revenue return are common and entirely survivable, provided every invoice, charter manifest and camp account behind the claim can still be produced in the form CRA asks to see it.
  • We take the file from the first letter onward, answer inside the stated deadlines, and keep a review of one year from widening into the earlier years CRA is entitled to reopen when something looks unexplained.
  • A Notice of Objection is filed within 90 days of a reassessment wherever the position is worth defending, which preserves the appeal route instead of leaving you holding an assessment with no way back from it.
  • Where penalties trace to an earlier adviser’s error or to circumstances outside your control, relief is pursued on Form RC4288, and on one file that removed roughly $14,000 of penalty and interest from the account.
  • Compilation engagement statements are prepared under CSRS 4200 with a Notice to Reader, which is the document a lender, an incoming partner or a prospective buyer asks for before agreeing to look at anything else.
  • The statement of financial position carries machinery at net book value, capitalised property interests and the expenditure pools set out clearly, so a reader can see what has been spent and what remains available to claim.
  • Site rehabilitation is a genuine future obligation of the company and belongs in the statements, and its tax treatment is determined separately on the facts rather than assumed to follow whatever the accounting does with it.
  • Two comparative years are presented and tied to the T2 filed for each of them, because a set of statements that disagrees with the corporation’s own returns is worse than having produced no statements at all.
  • Statements are delivered within 30 days of a complete record set arriving, since a conditional offer that expires while the file is still being assembled costs a great deal more than the engagement ever did.
  • Incorporation is handled end to end, covering name search, articles, minute book, share classes and the opening CRA accounts, with the first fiscal year end chosen deliberately so the first return and balance-due date fall where they suit you.
  • Where an individual has been carrying property interests and equipment personally, the section 85 rollover on Form T2057 moves them into the corporation at elected amounts and defers the gain an outright transfer would otherwise trigger.
  • Share classes are settled at the outset to accommodate later investors and family shareholders, because rearranging who owns what after money has already arrived is expensive and occasionally impossible to do cleanly at all.
  • The payroll, HST and business number accounts are opened before the first hire and the first invoice, so coverage and registration are genuinely in place on day one instead of being backdated under pressure later.
  • The break-even is modelled honestly: for a company still spending and not yet earning, incorporating is about liability, pool ownership and structure rather than about the tax rate, and we tell you so plainly.
  • Ledgers are rebuilt season by season from bank statements, contractor invoices and whatever camp paperwork survived, with each expenditure re-examined against the activity that funded it rather than dropped into one undifferentiated exploration account.
  • Pool balances are reconstructed and carried forward from the earliest year with usable records, which on one company four seasons behind restored roughly $310,000 of expenditure to the pool it should have entered originally.
  • Equipment bought across the neglected years is brought onto a continuity schedule in Class 41, Class 10, Class 8 or Class 12, so capital cost allowance that was never claimed becomes available again.
  • Every input tax credit still inside its claim period is identified and recovered, and the ones that expired are reported to you in writing rather than quietly left out of the working papers and forgotten.
  • What you end up with is a ledger that ties to the bank, to the slips and to the returns, which is the only condition under which the next several years can be filed with any confidence.
  • Canadian-side reporting is handled where a shareholder, a director or a funding entity sits in the United States, covering amounts withheld on distributions leaving Canada and the disclosure the corporation owes on property it holds abroad.
  • Where a United States corporation sits in the group its Form 1120 is prepared, and Form 1120-F where a Canadian company has United States activity, so both revenue agencies are looking at figures that agree.
  • Foreign affiliate reporting on Form T1134 and foreign property reporting on Form T1135 are prepared wherever the tests are met, because these are information returns carrying penalties of their own quite apart from any tax.
  • A United States limited liability company is characterised differently on each side of the border, and that mismatch is reconciled inside the filings rather than discovered by the owner two years further down the road.
  • Foreign tax credits are claimed on Form T2209 so tax already paid in the United States is not paid a second time in Canada, which on a modest cross-border structure is regularly worth five figures annually.
  • A submission is prepared on Form RC199 and put forward under the general track, which cancels the penalties outright and reduces the arrears interest CRA would otherwise charge across the older years of the file.
  • Unreported amounts are quantified from your own records first, so the disclosure sets out a complete picture rather than inviting CRA to establish one on its own terms after the application has already gone in.
  • Field wages paid without slips across several seasons are brought forward with the payroll years filed behind them, which is usually the largest single exposure on a company that has been in the bush a decade.
  • HST collected on contract work and never remitted, or credits claimed without the invoices to support them, are corrected inside the same submission so a single application closes the whole of the problem at once.
  • Before anything goes in we check the three conditions the program turns on: that CRA has not already made contact about the matter, that nothing at all is being held back, and that a year has passed on the earliest filing.

Exploration Expenditure & Field Payroll Tax Check

Six quick questions on how your expenditure is characterised, whether your pool balances are current, HST recovery before revenue, field crew status, WSIB and whether incorporating is worth it. No fee shown.

1. Is each field cost characterised as exploration or development at the moment it is incurred, and written down then?

2. Are your CEE and CDE pool balances maintained continuously rather than rebuilt once a year?

3. Is the company registered for HST and recovering input tax credits while it still has nothing to sell?

4. Has every field crew engagement been settled on its own facts, with a T4 or T4A filed on that answer?

5. Is WSIB coverage open and reported on assessable earnings from the very first hire?

6. Is your mining company incorporated?

Free CPA Consultation for Mining Companies

Case Studies: Mining Company Accounting & Tax

Wawa Exploration Company — One Account for Two Different Pools

The problem: A Wawa company had run four field seasons through a single account called exploration. Some of that spending went to establishing whether anything was there; some went into work on ground the company had already decided to advance. Nothing in the ledger separated the two, the day sheets sat in a filing cabinet at the camp, and $2,100,000 stood in one balance nobody could support line by line.

What we did: We went back to the day sheets, assay certificates and contractor invoices, characterised each cost against what that work had been undertaken to establish, split the balance between the ITA 66.1 and ITA 66.2 pools on that evidence, and built a coding rule the field office now applies as invoices arrive.

The result:

  • $2,100,000 characterised on contemporaneous evidence
  • Two pool continuities now supportable line by line
  • Field coding applied at source rather than at year end

Red Lake Junior Explorer — Three Years of Tax Nobody Reclaimed

The problem: A Red Lake company had never registered for HST, on the reasoning that it had no sales and therefore nothing to file. It had spent three seasons paying 13% on drill contracts, charters, camp catering, fuel and assay work and had never recovered a cent of it. The owner had treated the tax as part of the cost of being in the bush, and by the time we saw the file some of the earliest periods had already closed.

What we did: We registered the company, set the reporting periods, filed from the effective date forward and matched every recoverable credit to the invoice behind it, then reported plainly which of the oldest amounts were past recovery and why.

The result:

  • About $141,000 of input tax credits recovered
  • Roughly $18,000 confirmed as out of time and reported
  • Quarterly recovery now running while revenue stays nil

Kirkland Lake Field Program — A Crew Nobody Had Classified

The problem: A Kirkland Lake company staffed each season with drillers, line cutters, a camp cook and two consulting geologists, and paid all of them against invoices because that was how the previous bookkeeper had done it. No WSIB account existed and no slips had ever been filed. What each person was engaged to do, and under whose direction, existed only in the project manager’s memory.

What we did: We tested each engagement on its own facts while the crew could still be asked, moved the people the facts made employees onto payroll, issued T4 slips there and T4A slips to the two geologists, opened WSIB coverage from the correct date, and built a season calendar carrying the remittance dates and the February slip deadline.

The result:

  • Every engagement documented on recorded facts
  • WSIB opened and assessable earnings reported
  • T4 and T4A slips now filed inside the February window

Our Simple Process

How We Work With Mining Companies

Know Exact Fees within 2 Minutes NOW

Our clear, efficient process ensures every step is transparent, building trust and long-term client relationships.

Here’s a simplified process approach:
Step 1

Kickoff (Document Request)

Prior T2 returns and pool continuities, HST filings and the registration date, payroll records and slips, WSIB statements, field paperwork including day sheets and assay certificates, partner agreements, equipment invoices and bank statements.

Step 2

First 30 Days (Cleanup & Setup)

Books rebuilt in QuickBooks Online or Xero with Dext behind the field paperwork, a coding structure by activity established, the ITA 66.1 and ITA 66.2 continuities restated, the Class 41, 10, 8 and 12 schedules rebuilt, and every engagement tested.

Step 3

Monthly Close

Invoices coded to the activity that produced them, partner recoveries kept out of expenditure, credits matched to supporting documents and claimed in period, HST filed, payroll agreed to the PD7A, and a burn and runway report issued.

Step 4

Quarterly Planning Review

Claim sizing against the year the return will actually report, credit determination on the season just finished, equipment timing across the classes, remuneration mix where an owner draws, and the cash position against the field plan ahead.

Step 5

Year-End Close & T2 Filing

Trial balance, statements carrying pool balances, capitalised property interests and the rehabilitation obligation, recapture computed on any disposal, the T4 and T4A slips agreed, and a T2 with GIFI going in on its date.

Get Your Mining Company Taxes Done Right Today

Transparent Pricing for Mining Companies

Affordable Pricing for Mining Companies

Know Exact Fees within 2 Minutes NOW

We believe in clear, upfront pricing so you know exactly what to expect. All fees include HST.

  • Tax Preparation (Corporation) — From $400
  • Tax Return Filing (Corporation) — From $400
  • Tax Compliance Audit — FREE CRA audit support for our clients
  • Tax Strategy — FREE for our clients
  • Accounting Base Plan — From $100 per month
  • Bookkeeping Management — Free for our Accounting clients
  • Financial Reporting — Free for our Accounting clients
  • Business Formation — Flat $35
  • Incorporation Process — Flat $35
  • Entity Setup Assistance — Flat $35
  • Full-Service Payroll — From $125 per month

Payment is by Interac e-Transfer to info@gondaliyacpa.ca only. Security question: Not Applicable, as auto-deposit is enabled.

Meet Your Lead Mining Company Accountant

Meet your lead mining company accountant. The same principal and the same accounting specialist stay on the file across field seasons, so nothing about your expenditure history has to be explained twice.

Sharad Gondaliya CPA

Sharad Gondaliya, CPA

Principal

Bio

647-212-9559
sharad@gondaliyacpa.ca

Vandana Goel CPA

Vandana Goel, CPA

Accounting Specialist

Bio

647-250-0242
vandana@gondaliyacpa.ca

What Our Clients Say

1300+ five-star reviews from resource, field services and owner-managed corporation clients across Ontario and Canada.

Serving Mining Companies Across Ontario

Companies working ground from the Abitibi belt to the northwest bring us the same file: years of spending, no income yet, and a set of decisions that were made in a camp and never written down. We know why the characterisation of a cost matters more than its amount, why a company with nothing to sell should still be registered, how a field crew has to be engaged and reported, and which questions CRA reaches for when a return shows expenditure and no revenue.

Toronto (ON)

55 Queen St E Ste 1205, Toronto, ON M5C 1R6, Canada

+1 (647) 212-9559

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Mississauga (ON)

2100 Camilla Rd #716, Mississauga, ON L5A 2J8

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Brampton (ON)

4 Starhill Crescent, Brampton, ON L6R 2P9, Canada

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Scarborough (ON)

24 Clementine Square, Scarborough, ON M1G 2V7, Canada

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Vaughan (ON)

19 Cabinet Crescent, Woodbridge, ON L4L 6H9, Canada

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Oshawa (ON)

210 Durham St, Oshawa, ON L1J 5R3, Canada

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Ottawa (ON)

2090 Neepawa Ave a314, Ottawa, ON K2A 3L6, Canada

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Etobicoke (ON)

60 Stevenson Rd #1601, Etobicoke, ON M9V 2B4, Canada

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Hamilton (ON)

70 Starling Dr, Hamilton, ON L9A 0C5, Canada

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Guelph (ON)

1155 Gordon St, Guelph, ON N1L 1S8, Canada

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Windsor (ON)

4387 Guppy Ct, Windsor, ON N9G 2N8, Canada

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North York (ON)

150 Graydon Hall Dr #912, North York, ON M3A 3B2, Canada

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Mining Company Accounting & Tax FAQs

Should I incorporate my mining company?
For most people the answer is yes, and the reasons have little to do with the tax rate at first. A corporation is what holds property interests and equipment cleanly, what a partner or an investor can deal with, and what keeps the expenditure pools in a single entity that survives the people running it. Limited liability matters when crews are working in the bush. The rate argument arrives later. A corporation pays roughly 12.2% in Ontario on its first $500,000 of active earnings, while an owner taxed personally on the very same money climbs a scale that ends at 53.53%. If you have been carrying property interests or equipment personally, the section 85 rollover on Form T2057 brings them in at elected amounts.
Do I register for HST before my mining company has any revenue?
Almost always, and deliberately. Registration is compulsory only once taxable revenue passes $30,000 across four consecutive calendar quarters, which an explorer may never reach. But registration is also what makes recovery possible, and a company spending on drill contracts, charters, camp catering, fuel and assay work is paying 13% on nearly every invoice it receives. Unregistered, that tax is simply a cost. Registered, it comes back quarter by quarter. We register the company, set the reporting periods and file on schedule from the effective date onward.
Can I claim input tax credits when my mining company has no sales?
Yes. A registrant claims credits on the tax paid on inputs acquired for use in commercial activity, and exploration undertaken with the intention of earning revenue is commercial activity even though the revenue has not arrived. A return reporting no sales and a substantial credit claim is a perfectly ordinary filing. What has to be right is the documentation: each credit matched to the invoice supporting it, claimed inside its own period, and kept where it can be produced. Credits are lost far more often to invoices nobody entered than to any argument about entitlement.
What is Canadian exploration expense?
Canadian exploration expense, dealt with in ITA 66.1, is the category that certain costs of looking for a mineral resource fall into. It does not attach to a project or expire at the end of a season. It goes into a cumulative pool that carries forward, and in any year the company may deduct anything from none of the balance up to the whole of it, at its own option. That optionality is the point. The pool is an asset the company controls the timing of, which is unusual and worth managing rather than leaving on autopilot.
What goes into the CEE pool?
Costs incurred in determining the existence, location, extent or quality of a mineral resource are the general class, and the work that typically produces them is the early work: geophysical and geochemical surveying, line cutting, trenching, sampling and exploratory drilling. What decides any individual cost is not the invoice heading but what the expenditure was actually undertaken to establish. That conclusion has to be reached and documented when the cost is incurred, and the field record made at the time is the evidence it rests on. We set up coding that captures it at source.
What is the difference between CEE and CDE?
Both are cumulative pools and both carry forward, but they release at different speeds and they answer to different purposes. Canadian exploration expense under ITA 66.1 may be deducted at up to 100% of the pool balance in a year, at the company’s option. Canadian development expense under ITA 66.2 is limited to 30% of its balance on a declining basis. Which pool a given cost enters turns on what that cost was spent to do, and we will not hand you a list that purports to settle it, because a list does not survive contact with a real program. It has to be determined on the facts and documented when the cost is incurred.
Are my drillers employees or contractors?
It depends entirely on the engagement, and the answer is not chosen by either side. The question is examined on what actually happened: who directed the work, who supplied the equipment, who carried the chance of profit and the risk of loss, and whether the person was genuinely in business on their own account. A drilling corporation you contract with is an obvious contractor. An individual you hired for the season, directed daily and equipped yourself is very often an employee regardless of the invoice. We reach the conclusion while the facts are still available and record how.
Should a consulting geologist get a T4A?
If the geologist is genuinely carrying on their own practice, takes engagements from other companies, controls how the work is performed and bears their own business risk, then a T4A is the right slip for the fees you paid. If the person worked only for you, under your direction, on your schedule, the facts may point to employment and a T4 instead, whatever the invoices say. The distinction is worth getting right the first time, because the consequences of the wrong answer include the employer contributions and the interest that come with them.
Do I need WSIB coverage for a field crew?
If you have workers, coverage is required, and it is required from the first hire rather than from the first incident. Premiums are reported on assessable earnings and the account has to exist before the season starts, not after something goes wrong in a remote camp. An unregistered company that hires for three seasons and then comes to attention faces the premiums it should have paid plus interest, which is an avoidable expense for a corporation with no income. We open the account and keep the reporting current.
What CCA class is mining machinery?
Machinery and equipment used underground or at surface generally falls in Class 41, depreciating at 25% on a declining balance. Trucks and light vehicles sit in Class 10 at 30%, camp structures and general equipment in Class 8 at 20%, with small tools written off through Class 12 at 100%. Each purchase is reviewed rather than assumed, because a single asset in the wrong class distorts the schedule for as long as the company holds it. On disposal, ITA 13(1) brings back recapture where proceeds pass undepreciated capital cost.
Can I deduct camp and charter costs?
They are real costs of the program and they belong somewhere, but the question is where rather than whether. Camp catering, accommodation and air charter incurred in the course of exploring are characterised along with the rest of that work and follow it into the appropriate pool, while charters and camp costs supporting a different activity follow that activity instead. The 13% paid on all of it is recoverable as an input tax credit where the company is registered. What matters is that the manifests and camp accounts identify what the trip or the week was for.
What records does CRA want for exploration spending?
The ones made at the time. Contractor invoices and day sheets, drill logs, assay certificates, charter manifests, camp accounts, field notes and the program documents that say what each phase was intended to establish. ITA 230 sets a six-year minimum, but a cumulative pool routinely outlives that several times over, so the practical standard is to keep the records for as long as the balance they created exists. A pool balance is only ever as defensible as the paperwork behind it, and that paperwork cannot be recreated after the fact.
What happens to my pools if the company never reaches production?
The balances stay. A cumulative pool does not expire because a year passed without income, and there is no obligation to claim against nothing simply because a deduction is available. If the company is eventually sold or wound up, or if a change of control occurs, what becomes of those balances depends on the transaction and on rules that have to be looked at before anything is signed rather than afterwards. That is the single most common place where a decade of accumulated expenditure is lost, and it is entirely avoidable with advice taken in the right order.

Related Industries We Serve

Accountant for Natural Resource Companies

  • Expenditure pools and continuities
  • Field payroll and worker status
  • T2 filing and HST recovery

Accountant for Oil and Gas Companies

  • Sector-specific pool accounting
  • Equipment classes and disposals
  • Corporate returns and planning

Accounting and Tax Services for Small Businesses

  • Owner pay mix set annually
  • HST registration and filing
  • T2, GIFI and the year-end close

Accountant for Incorporated Businesses

  • Small Business Deduction protected
  • Section 85 rollovers
  • Dividends, salary and instalments

Mining Company Accounting & Tax Done Right.

T2 filing for a company that may have no sales at all, expenditure characterised and documented when it is incurred, the cumulative CEE pool under ITA 66.1 claimed at whatever share of the balance the year calls for, the cumulative CDE pool under ITA 66.2 at up to 30% declining, HST registration maintained so credits come back quarter after quarter, every field engagement judged on its own facts with the matching T4 or T4A issued, WSIB from the first hire, and machinery in Class 41 at 25% apart from vehicles in Class 10 at 30%. Every item above is quoted as a flat AFFORDABLE fee rather than billed by the hour. Gondaliya CPA is licensed by CPA Ontario, carries more than 1300 five-star reviews, and backs the engagement with a 30-Day Money-Back Guarantee.



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