Identify what the payment represents
A true deposit, an advance payment toward invoiced services and a cancellation charge are not automatically the same. CRA distinguishes a deposit held toward a purchase from the point at which it is applied; forfeiture can also create GST/HST consequences. The actual agreement and facts matter.
Keep the booking date, event date, scope, customer payment schedule and refund terms together. Record approved changes to guest numbers, menu, equipment or timing. The financial schedule should follow those changes without losing the original contract or payment history.
Illustrative example: three different cash claims
A Calgary caterer has received $18,000 across three future corporate events. Equipment and venue advances of $5,000 have been paid, with another $7,000 of approved commitments due before the events. The $18,000 collected is not automatically $18,000 available for owner withdrawal.
The deposit schedule explains what remains owed to customers, while the commitment list explains future cash needs. A preliminary cash view can start with the bank balance and then account for payroll, taxes, supplier due dates and other obligations. It should avoid subtracting the same commitment twice when a paid advance is already reflected in the bank.
Handle a cancellation as a documented transaction
If one event is cancelled, attach the customer's notice, the contract clause and the agreed settlement. Separately identify refundable amounts, retained amounts and supplier charges that cannot be recovered. A processor refund should tie to the customer record and any associated credit documentation.
For a simplified example of a qualifying forfeited deposit on an Alberta supply taxable at 5% GST, a retained tax-inclusive $1,050 contains $50 GST and $1,000 before tax. This is not a universal formula for all cancellation payments; first confirm the nature of the amount and the applicable treatment.
Close the booking after the last outstanding item
After delivery or cancellation, review unpaid invoices, vendor credits, final staff costs and customer balances. Mark the booking complete only when unresolved items have an owner and a clear treatment. Carrying an old balance forward without explanation can distort the next event's profitability.
A consistent close gives the owner a usable picture of commitments throughout Calgary's event calendar, including quiet periods when advances may look deceptively like surplus cash.
Put this into practice
Sources and current guidance
A practical next step
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