Self Employed

HomeSelf Employed

 

💡 Why Accounting Matters for the Self-Employed
If you’re self-employed in Canada, you’re responsible not only for generating income — but also for tracking expenses, paying taxes, and staying compliant with CRA rules. Whether you’re a freelancer, consultant, or running your own business, proper accounting can save you money, time, and legal headaches.

📚 Key Accounting Tasks for Self-Employed Individuals:

  1. Track All Your Income
    You must report all your income — even if you didn’t receive a T4A. Use accounting software or a simple spreadsheet to log client payments, invoices, and deposits.
  2. Separate Personal and Business Accounts
    Open a dedicated business bank account. This makes it easier to track deductible expenses and simplifies your records in case of a CRA audit.
  3. Keep Receipts & Track Expenses
    You can deduct many expenses, such as:
    – Office supplies
    – Internet and phone bills (portion)
    – Home office (pro-rated)
    – Travel related to business
    – Professional services (e.g., legal or accounting)

Keep digital copies of all receipts for at least 6 years.

  1. Understand GST/HST Obligations
    If your annual gross income exceeds $30,000, you must register for a GST/HST number and start charging tax to clients. This also means you must file regular HST returns.
  2. Pay Installments If Required
    If your tax owing is more than $3,000/year, CRA may require you to make quarterly installment payments. Failing to do so can result in penalties.
  3. Know Your Deadlines
    – Tax filing deadline: June 15 (for self-employed individuals)
    – Payment deadline: April 30 (interest applies after this date)
    – GST/HST filing: usually quarterly or annually depending on your setup

🧾 Should You Incorporate?
As your income grows, you may benefit from incorporating. This allows for:
– Lower corporate tax rates
– Income splitting (with family members)
– More tax deferral options

But it also comes with more paperwork and costs. Speak with an accountant before making the decision.

👨‍💼 Need Help with Self-Employed Accounting?
At 3bs Accounting, we specialize in helping self-employed professionals stay organized, reduce taxes, and focus on growing their business.

📞 Contact us today for a free consultation!
📧 info@3bsfinacial.com
🌐 www.3bsfinacial.com