Tax Tip – June 15, 2021 is the deadline for self-employed workers to file their 2020 income tax and benefit return
OTTAWA, ON, June 3, 2021 / CNW / – The Canada Revenue Agency (CRA) is here to help you and your business meet your tax obligations.
If you are self-employed, or if your spouse or common-law partner is self-employed, you have up to June 15, 2021, to file your 2020 income tax and benefit return.
It is important to file on time if you are receiving recovery benefits related to COVID-19, such as the Canada Recovery Benefit, the Canada Caregiver Recovery Benefit, or the Canada Illness Recovery Benefit. . The CRA uses the information from your 2019 and 2020 returns to confirm your eligibility for these benefits. Filing on time prevents your clawback benefit payments from stopping while we validate your eligibility.
Who is considered independent?
Generally, you are self-employed if any of the following apply to you:
- you carry on a trade, profession or business as a sole proprietor or independent entrepreneur
- you are a member of a partnership that operates a business or business
- you are otherwise in business for yourself (including a part-time business)
- if you participate in the platform economy, which includes economic and social activities facilitated by the use of technologies such as the internet and mobile applications.
To determine if you are self-employed or an employee, visit our Employee or Self-Employed webpage for more information.
What are my tax obligations as a self-employed person?
If you earned self-employment income from a business that you operate yourself or with a partner, you must report that income by completing an income tax return.
When you are self-employed and operate your business, you must pay:
- personal income tax on your net self-employed income
- Canada Pension Plan contributions on the net income of the self-employed
- employment insurance contributions if you are registered to participate
Keep in mind that no matter how you generate income, you must report it on your tax return. Failure to report your income may result in penalties.
Reporting your income also means that the CRA will have the most accurate information on file to determine if you qualify for provincial and territorial tax credits and benefits, the GST / HST credit, and the tax. Canada family allowances.
How do I make my tax declaration?
You can file your return online using IMPTNET or by having a tax preparer file your tax return through the CRA’s EFILE service. We strongly encourage you to file your return online to get your refund faster and to avoid delays. You can also mail your paper return and supporting documents to your CRA tax center. However, if you file a paper return, it can take 10 to 12 weeks to process, due to possible COVID-19 delays.
Online services for businesses and the self-employed
The CRA offers easy-to-use online services for businesses and the self-employed. You can use these services to deposit, make payments and get detailed information about your account.
Free tax help for small business owners and the self-employed
If you own a small business or are self-employed, the CRA offers free liaison officer services by phone or video conference. Liaison officers can make filing easier by helping you understand your tax obligations, answering your questions, and educating you about possible tax deductions. For more information, go to canada.ca/arc-agent-de-liaison.
Even if June 15, 2021 is your filing deadline, the deadline for paying any balance owed was April 30, 2021. If you have a balance owing, there are a number of convenient ways to pay:
- through online banking or by phone from your financial institution
- using the My payment service, accessible from My Account or MyCRA, that allows you to make payments to the CRA online with your Visa® Debit, Debit MasterCard® or Interac® debit card online from a participating financial institution
- set up a pre-authorized debit agreement through My Account and MyARC to:
- make pre-authorized payments to the CRA from your account at a Canadian financial institution
- pay an overdue amount or make installment payments
- by credit card, PayPal or Interac e-Transfer through a third-party service provider
- in person at any Canada Post point of sale using cash or a debit card, with a QR code you can create using My Account or My CRA
- in person at a Canadian financial institution with a remittance voucher
If you cannot pay in full, contact the CRA to set up a payment arrangement to pay your balance owing over time.
For more information on your payment options, go to canada.ca/payments.
Keep receipts and documents
It is important to keep detailed records of the money you earn and spend. Your records should provide enough detail to determine the tax you owe and justify the deductions you are claiming. They must be supported by original documents.
Sometimes the CRA reviews returns to make sure income, deductions, and credits are properly reported. If the CRA is reviewing your return, having your receipts and records on hand will make it easier for you to support your claims.
New Extended Hours for Business Information Line and Part XIII Tax Line
To give businesses more time to get their questions answered, our business information line is now open Monday through Friday from 8:00 a.m. to 8:00 p.m., and the Saturday of 9 a.m. to 5 p.m. Our Part XIII tax line is now open Monday through Friday from 7:30 a.m. to 8 p.m. ET.
More help for your business
The Canada Business app simplifies access to government services for small and medium-sized businesses by Canada. Designed for business owners, the app puts government programs and services at your fingertips. Download it now from the App Store or Google Play.
More ranking tips
For more tips and useful information, see our tax tips for self-employed workers.
Stay logged in
SOURCE Canada Revenue Agency
For further information: Media Relations, Canada Revenue Agency, 613-948-8366, [email protected]