How online payments work for Canadian shops

When a customer pays, the card details never touch your website if the checkout is built properly. They go straight to the payment processor, which is what keeps you out of scope for most card-security rules.

Fees are usually a percentage plus a flat amount per successful charge, with extra for international cards and currency conversion. Model them into your prices before launch, not after.

Canadian tax rules depend on what you sell and where the customer is. Configure the rates once, in one place, and keep the invoice showing them separately.

Refunds and chargebacks are different things. A refund is your decision; a chargeback is the bank's, and you will need records to contest it. Keep order confirmations and delivery evidence.

Subscriptions add renewal emails, failed-payment retries and cancellation flows. If you plan to bill monthly, build those from the start rather than bolting them on.

It helps to picture the steps, because almost every support question maps to one of them.

• Checkout: the customer enters card details on the processor's secure field, not your server.
• Authorisation: the bank confirms funds and places a hold.
• Capture: the charge is taken, usually immediately for goods, sometimes later for services.
• Payout: the processor deposits the batch to your bank, typically in two to seven days.
• Reconciliation: the payout is matched against orders and fees in your books.

Credit and debit cards cover most of it. Digital wallets meaningfully lift completion rates on phones and cost nothing extra to enable. Interac and bank transfers suit larger invoices where card fees hurt. Buy-now-pay-later can raise average order value but carries its own fee, so treat it as a pricing decision rather than a feature.

For service work, taking a deposit at booking changes no-show rates far more than any reminder does. If you plan to bill monthly, build renewal emails, failed-payment retries and a self-serve cancellation from the start. Saved cards must be stored with the processor, never in your own database.

The single biggest bookkeeping mistake with online payments is recording the payout as revenue. The payout is revenue minus fees minus refunds, batched. Record the gross sale, the fee as an expense, and match the payout as a transfer — then your revenue figures match your invoices and your accountant does not have to unpick it in March.

Use a recognisable name on the card statement, send an itemised receipt immediately, keep delivery or completion evidence, and publish plain refund terms the customer accepted at checkout. Most chargebacks are confusion rather than fraud, and clear paperwork resolves them before they escalate.

Expect to provide business details, banking information and identification for the owner. Approval is usually quick, but payouts are often held for the first week or two while the account establishes a history. Plan the launch around that so you are not surprised when the first sales sit in the processor rather than the bank.

• Complete a real purchase yourself, with a real card, then refund it.
• Check the receipt wording, the statement name and the tax line.
• Try it on a phone, on mobile data, and with a wallet payment.
• Deliberately fail a payment and read the message the customer sees.
• Confirm the order appears in your books and in your email.

The processor handles card data, but the rest is yours: strong passwords and two-factor on the payment account, up-to-date site software, restricted admin access, and never storing card numbers anywhere. Also watch out for card-testing attacks on small shops — a sudden run of tiny failed transactions is a signal to turn on additional verification.

Most abandoned checkouts are not price decisions. They are surprise shipping costs, forced account creation, too many fields, or a page that looks unfamiliar. Show the total early, allow guest checkout, keep the form short, and make the payment step look like the rest of your site. Those four changes usually do more for revenue than another round of advertising.