Posthaste: Canadians are taking on more side hustles, but they may not be telling the CRA - Yahoo Canada Finance

Canada Revenue Agency,

Good morning.

Canadians are increasingly taking on jobs in the gig economy as the rising cost of living puts pressure on their finances, but many of them are tempted to not declare all the extra income they’re earning, according to a new survey by H&R Block Canada Inc.

The tax preparer found that 28 per cent of the 1,501 adults surveyed have taken jobs in the gig economy to boost their income, up from 13 per cent in 2022. In the past 12 months alone, 20 per cent have taken on a gig job.

But 49 per cent of those who currently have a side hustle indicated they would be willing to risk not declaring all their related income, and a further 44 per cent said they would be willing to risk not declaring any of it.

“The survey indicates that many Canadians feel tempted to avoid declaring all their income from a side gig, and many lack an understanding of the tax implications,” Yannick Lemay, learning program lead and tax specialist at H&R Block Canada, said in a press release.

“While it’s easy to think that smaller amounts may go unnoticed, by not declaring all income to the Canada Revenue Agency (CRA), Canadians face the risk of not just having to pony up for the full amount of taxes owing if they’re audited, but they’ll also be charged interest and could face substantial penalties if it’s discovered.”

Part of the problem is that 23 per cent of gig workers don’t have a clear understanding of the tax implications of having a side hustle.

“The good news is there are literally hundreds of potential deductions and expenses that can be claimed; many of which put money back into your pocket,” Lemay said. “The gig workforce is incredibly diverse, so navigating tax-related benefits can be complex. What’s important is having a full understanding of your specific tax situation, so you don’t inadvertently leave money on the table when filing your taxes.”

He added, however, that if people don’t claim all their income, any penalties levied by the CRA may include returning many of those tax deductions, credits and benefits.

Overall, 85 per cent of Canadians are concerned that their income is not keeping up with the increased cost of living, so it makes sense that 63 per cent of gig workers said they took on a side hustle because of those rising costs and inflation this year, and a further 15 per cent are considering taking on a side hustle in the future.

However, their level of disclosure to their primary employer is almost evenly split between those whose employers are not aware of their side hustle (51 per cent) and those who have made their employer aware (49 per cent).

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Companies that have more women at board level tend to have higher credit worthiness, according to new findings by Moody’s Investors Service Inc. Having more gender-balanced leadership typically leads to better corporate governance, which in turn supports credit quality, the ratings agency said in a global gender report published on Wednesday. — Bloomberg

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• Toronto Regional Real Estate Board to release February home sales figures

• Mental Health and Addictions Minister Carolyn Bennett announces mental health funding related to COVID-19

• Prime Minister Justin Trudeau will make a child-care announcement with Manitoba Premier Heather Stefanson

• B.C. Premier David Eby; Anne Kang, Minister of Municipal Affairs; and George V. Harvie, Metro Vancouver board chair, make an infrastructure funding announcement

• B.C. Premier David Eby makes a post-budget economic address to Surrey’s business community

• Today’s data: Canada labour productivity, building permits; U.S. ISM services PMI

• Earnings: SNC-Lavalin Group Inc. 

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Have you ever used Kickstarter or GoFundMe to support a service or movie that someone is trying to get off the ground? While these platforms are a great way to give fans exclusive access to content and products, it doesn’t provide any equity. But there are new portals emerging that allow investors to also own a piece of a company. Equity crowdfunding platforms are becoming more common in Canada, and it’s allowing everyday investors to own part of the action that was once reserved to accredited investors. Our content partner MoneyWise Canada has the details.

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Today’s Posthaste was written by Noella Ovid, with additional reporting from The Canadian Press, Thomson Reuters and Bloomberg.

Have a story idea, pitch, embargoed report, or a suggestion for this newsletter? Email us at posthaste@postmedia.com, or hit reply to send us a note.

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Posthaste: Canadians are taking on more side hustles, but they may not be telling the CRA - Yahoo Canada Finance
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