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Most childcare programs bill in one currency and never think about it. But programs near the border, those serving families who work for US employers, and organisations with locations in both Canada and the United States often find themselves dealing with two currencies. Without a clear policy, that leads to confusion, disputes over small amounts and messy books.
Why it comes up
- Border communities, where families live on one side and work on the other.
- Families paid in US dollars who would prefer to pay in the same currency.
- Organisations with sites in both countries, where each site bills locally but reporting is combined.
- Short-term or relocating families who have not yet set up local banking.
Invoice currency versus payment currency
This distinction causes most of the confusion. The invoice currency is the currency in which you state what is owed. The payment currency is the currency the family actually sends. They are not always the same.
If you invoice in Canadian dollars and a family pays in US dollars, someone has to convert. If the rate used by the family's bank differs from the rate used by yours, the amount you receive will not match the invoice. The difference might be small, but repeated monthly it creates a stream of tiny underpayments or overpayments to chase.
The simplest approach is usually one of these:
- Bill each family in one currency and require payment in that currency. Clear, but less flexible.
- Offer a choice of currency at enrolment, then bill and collect in that currency consistently.
- Bill in one currency and accept the other at a stated rate, with a clear rule for differences.
Put your exchange-rate policy in the contract
If you accept payment in a different currency from the invoice, write down how conversion works. Your enrolment agreement or fee policy should answer:
- Which currency the fees are set in.
- Which rate applies if paying in the other currency, and from which source and on which date.
- Who bears bank or conversion fees.
- How small differences are handled, for example carried to the next invoice.
- Whether you will reset fees in the other currency if rates move significantly, and how much notice you will give.
A written policy turns a potential argument into a simple reference to what everyone agreed.
Bank accounts
If you regularly receive US dollars, a US-dollar account can avoid converting every payment as it arrives. Many Canadian banks offer US-dollar accounts for businesses. Ask your bank about fees, how deposits from US banks are handled, and which payment methods work into that account. Card payments in a second currency depend on your payment processor; confirm what it supports and how it settles funds.
Keep the two currencies in separate accounts rather than converting back and forth. It makes reconciliation much easier.
Communicate clearly with families
- Always show the currency code on invoices, not just a dollar sign. CAD and USD both use the same symbol.
- Explain your policy at enrolment, in writing, before the first invoice.
- If a payment comes in short because of conversion, explain the difference plainly rather than sending a vague overdue notice.
- Give notice before any change to fees or rates.
Record keeping
For each payment, record:
- The invoice it applies to and the invoice currency.
- The amount and currency received.
- The rate used and the source of that rate, if converted.
- Any fees deducted by banks or processors.
Your accountant will tell you how to report foreign-currency amounts in your books and tax filings. Having this detail recorded as you go saves a great deal of reconstruction later.
Receipts for families
Families may need childcare receipts for tax purposes in Canada, the United States, or both. Requirements for what a receipt must show differ. Confirm what your families will need, and whether receipts should show amounts in a particular currency, with your accountant.
How KiddieTrac helps
KiddieTrac supports billing in both CAD and USD, with the currency shown on each invoice. Invoices are generated automatically, families can pay online, and QuickBooks sync helps keep your accounting records consistent.
