Nearly 22% of adult Canadians, about 7.3 million, do gig work. New research and a survey conducted by Securian Canada reveals that many employees, including high earners, take on extra jobs out of financial necessity or stress.
The most popular forms of side income are e-commerce and online reselling, freelancing and digital services, and rideshare or delivery driving. However, the Canada Revenue Agency (CRA) treats side income as self-employment business income. This means that all your earnings from day one are taxable and must be reported to the CRA.
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Track every transaction or payment received
If you’re doing extra work on top of your day job, record every sale or payment received from the very first transaction. You will report them as gross income in your annual tax return on Form T2125 (Statement of Business or Professional Activities).
Safekeep electronic receipts, e-transfer confirmations, and platform payouts. Don’t leave out any side income, whether small or irregular. You must support all gross revenue with documents.
Claim eligible business and operating expenses to lower your tax bill
Income tax is inevitable, but reporting side income comes with tax breaks. You can lower your tax bill by offsetting eligible operating and business expenses. Common deductions include home office space, software subscriptions, tools, advertising, and starter supplies. Make sure the expenses are directly related to income from the extra job.
Any proof of purchase requires presentation of a receipt (digital or paper). The CRA suggests keeping documents for at least six years. Your receipts must show the date, amount, seller name, and item description.
Small supplier to GST/HST account
The CRA classifies side hustlers as small suppliers. Your gross self-employment revenues, or total sales, not net profit, must not exceed the $30,000 limit. If your side-income revenue crosses the threshold in a single quarter, your small-supplier status immediately vanishes.
Also, keep in the mind the rolling 4-quarter rule. This rule is basically the “look-back method” where you add your gross side-income revenue from a single calendar quarter to the previous three quarters. If the combined total exceeds $30,000, you must register for a GST/HST account.
The mandatory status change authorizes your side business to legally collect Goods and Services Tax (GST) or Harmonized Sales Tax (HST) from Canadian clients. You can also get a full CRA refund for any GST/HST you paid as your own business expense.
Entrepreneurial boom
From an investment perspective, Shopify (TSX: SHOP) sits at the center of the e-commerce and entrepreneurial boom. The $304 billion global digital commerce company helped fuel the gig economy. Its platform now hosts millions of active merchants and stores across more than 175 countries.
In Q2 2026, net income and free cash flow rose 30% and 55% year-over-year to US$439 million and US$654 million, respectively. Harley Finkelstein, President of Shopify, said following the monster quarter, “We power every kind of business, and with AI, we’re expanding what’s possible for all of them.
SHOP has delivered a total return of plus-238.2% in three years, representing a 50% compound annual growth rate (CAGR). At C$236.24 per share, you’d be investing in a tech stock with a long-term growth play.
Good record-keeping is key
A side hustle or extra work can be rewarding, but income from it is taxable. The CRA is watching, but with excellent record-keeping, you can lower your tax bill and enjoy your profits.
