Do You Have to Report Side Hustle Income in Canada?

Yes. If you earn money on the side in Canada, from delivery apps, freelancing, tutoring, reselling or an online shop, the CRA expects you to report it on your tax return, whatever the amount. The $30,000 figure you often hear is the threshold for charging GST/HST, not an amount you can earn tax-free.

Selling your own used things is different, and clearing out a closet on Facebook Marketplace usually isn’t income at all. But since 2024, the platforms that pay people for rides, deliveries, rentals and sales have had to report those earnings to the CRA every year, so the CRA can see a lot of side income whether you report it or not.

Is there a minimum before you have to report it?

No. The CRA’s rule (opens in a new tab) is that you report income from all sources, and a small amount is still income. The figures that get passed around as limits all mean something else, and none of them lets you leave side income off your return.

Being under one of these lines changes the paperwork, not whether the money counts. If a slip never arrives, or a platform doesn’t report you, the income is still taxable.

Is selling stuff on Facebook Marketplace a side hustle?

Usually not, if it’s your own used stuff. Furniture, clothes, a bike or a phone you owned for personal use is what the CRA calls personal-use property, and selling it for less than you paid doesn’t create income to report. It becomes a business when you buy things in order to resell them, or sell often enough that you’re doing it for profit.

If you sell something for more than you paid, like a collectible that went up in value, the gain can be taxable. But the CRA treats both the cost and the sale price (opens in a new tab) of personal-use property as at least $1,000, so a sale of $1,000 or less never produces a gain to report. And a loss on personal items can’t be deducted, except that a loss on a collectible can reduce gains on other collectibles.

When reselling turns into a business

What matters is why you’re doing it. The CRA says that when you buy goods for resale (opens in a new tab), that’s the starting point of a business. Its guidance on artists (opens in a new tab) has an example that fits most side hustles: a bookkeeper who sells his paintings on weekends is running a business, because he sells every week, advertises and runs it like a business to make a profit. Flipping thrift-store finds every weekend, or a steady trade in sneakers or trading cards, is the same.

Does the CRA know about your side income?

More and more of it. Since January 1, 2024, digital platforms that pay people for personal services, rentals or sales have had to report each seller’s earnings to the CRA once a year, and send the seller a copy by January 31. The first reports, covering 2024, were due January 31, 2025.

That covers a lot of people. In the year to December 2025, 667,000 Canadians did paid work through an app or website (opens in a new tab), and fewer than a quarter of them did it as their main job.

According to the CRA, the report includes (opens in a new tab):

• your name, address, date of birth and social insurance number
• the bank account the platform pays you into
• what you were paid in each quarter, how many transactions you had, and the fees the platform kept
• for rentals, the property’s address and the number of days it was rented

People offering services and rentals get no small-seller exception. Only people selling goods are left out, and only if they had (opens in a new tab) fewer than 30 sales and $2,800 or less in the year. If a platform asks for your SIN and you don’t give it, the CRA can charge you $500 for each failure.

A business that pays you more than $500 for services in a year may also send you a T4A slip. Whatever is on it goes on the same lines of your return as the rest of your side income.

How much tax will you pay on side income?

Your side profit is added to your other income and taxed at your marginal rate, the rate on your last dollars of income. You usually pay CPP on it too, both the employee and the employer halves. On a $60,000 job in Ontario, $5,000 of side profit costs about $2,078 in 2026: $1,483 in tax and $595 in CPP.

The tax part comes from the 2026 rates (opens in a new tab): at $60,000 in Ontario, each extra dollar is taxed at 29.65%, the federal 20.5% plus the provincial 9.15%. The CPP part is 11.9% of your self-employment earnings in 2026, because you pay both shares (opens in a new tab). You get some of that back through a deduction and a tax credit, so the true cost is a little lower. The rate is set to drop to 11.5% (opens in a new tab) on January 1, 2027.

At a $40,000 job in Ontario, the same $5,000 costs about $1,800. The tax rate there is 19.05%, but Ontario’s tax credit for low-income workers (opens in a new tab) shrinks by 5 cents for every dollar of income above $32,500, so the extra income also costs you about $250 of that credit. And once your job pays $85,000 or more, you’ve already paid the maximum CPP through payroll, so you don’t pay any on your side income.

Nobody withholds tax on it

Your employer takes tax off your paycheque. Nobody does that for side income, so the whole bill arrives in the spring. If you owe more than $3,000 when you file ($1,800 in Quebec) in 2026 and in either of the two years before, the CRA will ask you to pay in quarterly instalments (opens in a new tab). Setting aside part of every payment as it comes in is the easiest way to avoid a surprise. Our guide to saving on an irregular income walks through that setup. If the bill has already arrived and you can’t cover it, here’s what happens when you owe the CRA.

In Quebec

You report the same income on your Revenu Québec return (opens in a new tab) as well, using form TP-80 for business income, and you pay QPP instead of CPP. The self-employed QPP rate (opens in a new tab) for 2026 is 12.6% on earnings up to $74,600, since you pay both shares here too. At a $60,000 job in Quebec, each extra dollar is taxed at 36.12% once federal and provincial tax are combined, the same rate that applies to savings account interest.

What can you deduct from side income?

Anything reasonable you spent to earn it. You pay tax on your profit, not on everything you took in, so the fees a platform keeps, your supplies, and the business share of your phone, car or home can come off the income. You report it all on form T2125 with your return, and you should keep the receipts.

The CRA’s guide to self-employment expenses (opens in a new tab) goes line by line through what counts. If your side hustle loses money, the loss can reduce your other income, but only if it’s a real business run to make a profit. A hobby’s losses can’t be deducted.

Do you need to register for GST/HST?

Only once your sales pass $30,000 over four calendar quarters in a row (opens in a new tab), with one exception: rideshare drivers have to register from their first dollar. Staying under $30,000 means you don’t charge GST/HST. It doesn’t change what you owe in income tax.

If you pass $30,000 in a single quarter, you start charging GST/HST on the sale that took you over.

What if you haven’t been reporting it?

Fix it before the CRA finds it. You can change a past return (opens in a new tab) in My Account for any year after 2015, or by mail with form T1-ADJ, and pay what you owe plus interest. For bigger amounts, the Voluntary Disclosures Program (opens in a new tab) can cancel penalties and much of the interest, and the best relief goes to people who come forward before the CRA contacts them.

Waiting costs more. If you leave $500 or more off your return and did the same in any of the three years before, the penalty is up to 10% (opens in a new tab) of the amount you left off, from Ottawa and, outside Quebec, from your province too, on top of the tax and interest. Leaving it off knowingly can cost 50% of the tax you tried to avoid.

Save what’s left once the tax is set aside

After the tax share of each payment is put aside, what’s left is money your regular budget never counted on, which makes it easier to save than most. Left in chequing, it usually gets spent on small things you won’t remember.

Lodavo gives you a reason to leave it there. It’s a free app that connects to the savings or chequing account you already use, and every $25 in it earns you a ticket in a weekly draw for cash prizes up to $10,000. Keep $500 of side money saved and that’s 20 tickets in every weekly draw, for as long as it’s there. Your money never leaves your account.

Download Lodavo free on the Apple App Store (opens in a new tab) or the Google Play Store (opens in a new tab), and your savings start counting toward the next draw.

This article is general information, not tax advice. Your rate, your province and whether the CRA sees your activity as a business all change the answer.

Terms and conditions apply. No purchase necessary (alternate method of entry available). Skill-testing question required. Open to legal residents of Canada who are the age of majority. Odds depend on the number of eligible entries received. Full rules and odds at our contest rules.