Thanks so much!

Hey Tim,

You do have to declare the income, just choose an industry that’s close enough, that would likely be marketing. The $100 income is considered self-employment income, so CPP contributions are optional. That said since you have a full-time job, if you already reach the max CPP contributions each year, there’s no need to contribute anymore. Cash is likely the best choice. Honestly, don’t over think things. It’s $100, if you put whatever is close enough, you’ll be fine.

I was employed full time in 2022, but I also received a small affiliate commission of $100 since starting affiliate marketing on the side last year. I understand that I will likely have to declare this with form T2125, however I am unsure about the industry code for affiliate marketing and if I will need to make CPP contributions on this small amount, since I already contribute through payroll deductions by my employer. Also wondering if I should check off the Cash or Accrual box for Accounting Method (commission only) and if I need to provide the url of my lead capture page under Internet Business Activities, since I didn’t earn the commission through a website that I own or operate. Any suggestions would be greatly appreciated. Thank you

Hey Alicia,

This question goes beyond my expertise. I would advise consulting an accountant.

I’d be interested in getting a virtual address to keep conducting my freelance business in Vancouver while residing in another province.
Are you familiar with this concept? If so, do you know if I can communicate it to the CRA as a replacement for my current physical address?
Also, would I need to invoice the GST applicable in the province where the virtual address is, or in the new province?
Thank you in advance for your help and have a nice day/evening!

Andrey,

GHST/HST is paid based on where the services are rendered. So yes, if your client is in Ontario, you’d charge 13%. You don’t need to pay another 5% for your home province since you’ve already collected it in Ontario.

GST/HST does not apply to any clients outside of Canada. That said, with Upwork it’s a bit tricky since the government introduced a new law for freelancers.

https://support.upwork.com/hc/en-us/articles/4401838411283-Canada-Indirect-Taxes-for-Freelancers

Basically, you should be inputting your GST number into Upwork and then they should be collecting taxes for you (and paying them to you). It would be then up to you to remit those taxes.

The tax you pay is based on the work you performed. So on $100, you’d pay the 5% GST. The 20% fee you pay can be deducted as a business expense and would lower your overall taxable income.

Note that I am not an accountant, I’m speaking strictly in general terms.

Morning Barry. Thank you for the quick response.
May I ask more questions?
If my client on Upwork from Ontario I have to pay 13% GST to CRA and 5% if the client from Alberta, right?
How about if I have the clients on Upwork outside of Canada? Do I have to pay GST to CRA for the outside clients. And how much?
One more.
Lets say an Upwork client pays 100$. The Upwork fee 20% plus GST 5% on the Upwork fee. I will have 100-(20+1)=79$ Which amount (100 or 79) I should use when I will calculate GST for CRA?
Thanks.

Andrey,

If you’re registered for GST, you’d have to pay any GST earned from your side hustle. That said, any GST you paid to run your business would offset what you owe. Basically, wen you file your taxes, you’d find out what you owe or don’t owe. Upwork should have an option to input your GST information. But if you only made $1,000 US. Any GST owed would be minimal.

Vide,

You do not need to register your business and You do NOT need to incorporate to register for an HST account.

Subcontractors can be written off as an expense. I don’t remember off the top of my head where it falls under as my accountant takes care of that.