Mobile menu

Charging tax in Canada
Thread poster: Jenna T
Jenna T
Local time: 14:22
French to English
Jun 14, 2007

From reading around I have discovered that you have to charge GST for your freelance work if your income is over $30,000. My question is does this $30,000 include income from all source (ie if you have a steady job as well) or from your freelance work alone? Thanks.

Direct link Reply with quote
 

Tina Vonhof  Identity Verified
Canada
Local time: 12:22
Member (2006)
Dutch to English
+ ...
Income from business Jun 14, 2007

Hi Jenna,

It applies to the income from your (translation) business only.


Direct link Reply with quote
 

Isabelle Pelchat  Identity Verified
Canada
Local time: 14:22
English to French
+ ...
Small supplier and annual taxable sales Jun 14, 2007

Hello Jenna,

Maybe this article could help you:

http://www.revenu.gouv.qc.ca/eng/travailleur_autonome/affaires/premieres_demarches/inscription/fournisseur.asp

It is for Quebec suppliers but I'm sure it is the same rule in other provinces.


Direct link Reply with quote
 

ViktoriaG  Identity Verified
Canada
Local time: 14:22
English to French
+ ...
The amount has changed Jun 15, 2007

If I am not mistaken, the $30000 has changed this year to $35000.

You can still charge the taxes if you make less than this amount - this has an advantage and a disadvantage. The advantage is that you are putting aside the amount for taxes that you would have paid quarterly or at the end of the year (as long as you really put the amount paid in taxes into a separate account you never withdraw from or a similar solution - an ING Direct account is great because you can make substantial interest on that amount), so it's not as hard on you as coughing up a larger amount to pay at the end of the year. The disadvantage is that you will have a bit more paperwork. Personally, I don't think it's worth it unless you invest the tax money until you have to pay it to turn it to your advantage - but then again, you can do this without charging the taxes, by taking more or less 20% of your invoice amount and putting it aside in a savings account.

If your business income is below that amount, it is probably best not to charge the taxes.


Direct link Reply with quote
 
Julie Larochelle  Identity Verified
Canada
Local time: 14:22
English to French
Charging tax in Canada Jun 15, 2007

It is my understanding that you may only charge taxes based on where your customer is living (and not your province of residence).

For example, if you live in Quebec and your customer lives in Alberta, you cannot charge QST. However, if you live in Ontario and your customer lives in Quebec, you can only charge QST if you are registered with Revenu Québec.

That is for Canadian customers. Of course, if your customer lives in the US or any other foreign country, no taxes should be charged since only Canadian individuals/companies are subject to such taxes.

Personally, less than 5% of my income comes from Canada. It is an interesting exercise to calculate how much income comes from Canadian customers and this could be another factor helping you decide whether or not it is worth registering to charge/claim GST and/or QST.

Regards,

Julie

Note: I found this link about exported services that might interest those who are curious about this matter:

http://www.cra-arc.gc.ca/tax/business/topics/gst/soleprop/taxable/importsexports/exportedservices-e.html



[Edited at 2007-06-15 22:43]

[Edited at 2007-06-15 22:44]


Direct link Reply with quote
 


To report site rules violations or get help, contact a site moderator:


You can also contact site staff by submitting a support request »

Charging tax in Canada

Advanced search


Translation news





Protemos translation business management system
Create your account in minutes, and start working! 3-month trial for agencies, and free for freelancers!

The system lets you keep client/vendor database, with contacts and rates, manage projects and assign jobs to vendors, issue invoices, track payments, store and manage project files, generate business reports on turnover profit per client/manager etc.

More info »
LSP.expert
You’re a freelance translator? LSP.expert helps you manage your daily translation jobs. It’s easy, fast and secure.

How about you start tracking translation jobs and sending invoices in minutes? You can also manage your clients and generate reports about your business activities. So you always keep a clear view on your planning, AND you get a free 30 day trial period!

More info »



All of ProZ.com
  • All of ProZ.com
  • Term search
  • Jobs