How to Claim Self-Employment with Employeed

[Smoky]

Hi all,

I have a concern about claiming income tax by self-employment with employeed.

I am an employee in 2008, also as a self-employment. I got my income from my employer, but no income by self-employment. My question is: Can I claim expense(training, auto expense) by no income self-employment? Trying to reduce my income if possible.

Any replies will be thankful.

 

[Teddy]

You can deduct your self-employment loss from your personal employment incomes... of course, you need to report your self-employment income if you may have...

Check the "Business Activities" or "Professional Activities" for self-employment guide for the taxation purpose...

 

[Smoky]

Great, thank you for your information.

I just wonder why everyone doesn't do the same way as both regular employee and self-employment at same time, it can save some money: income(employee) - expense(self-employment) = taxable income...

Please correct me if I am wrong.

 

[Teddy]

Not everyone conducts business activities or personal services as self-employment. You do need to actually conduct the activities supported with business records for the purpose. Simply, just can't "temporarily" set up a business like this during the tax season for potential benefits...

One clarification: income (employment) + income(/- loss) (self-employment) ... = net income

[Not "expense" directly deducted there...]

Have fun managing money...

Great, thank you for your information

I just wonder why everyone doesn't do the same way as both regular employee and self-employment at same time, it can save some money: income(employee) - expense(self-employment) = taxable income...

Please correct me if I am wrong.

 

[soulak]

You can only deduct your business loss from your business income;
if you don't have any business income, you can't claim any loss, that means you can't deduct business loss from your employment income(T4).

 

[ccc]

Play with it with caution as it is not as easy as 1, 2, 3.

 

[Teddy]

Have to say: this is not true! Please check the General Tax Return guide about the "Self employment incomes" lines...

You can only deduct your business loss from your business income;
if you don't have any business income, you can't claim any loss, that means you can't deduct business loss from your employment income(T4).

 

[嘟嘟狼]

if you dont have ANY income from your side business, but still have large amount of expenses running every year, i think you will very likely to get audited.

 

[greengrass]

Sole Proprietorship? Incorporation? Which kind of self employment did you choose?

 

[Smoky]

Thank you for all of responses.

I called CRA, the answer is yes. No matter you are employeed, also as a self-employment, can still claim the expenses, even no income in this tax year, so that will be income losing. But keeping all of reported receipts is very important, it might help you in the future when audited from CRA.

 

[Smoky]

Sole Proprietorship? Incorporation? Which kind of self employment did you choose?

Is there any difference between sole proprietorship and incorporation?
As my understanding, the income tax will base on income - loss(if have), others like hiring more employees are not my concerns.

 

[browser]

Mostly people would report business losses from using cars, or business use of houses including utilities fees because those "self-employed" won't really put money in the business. But CRA said that you can only deduct car use in business, the cost of business use house can only be deducted from business income...

Also remember what you do as your "self-employment" has to be a valid business...CRA is putting more man power to mend the fence, and don't think you are clever than the "government"...

 

[Smoky]

Try to be clarified between self-employment and incorporation(only me, no other employee).
For income tax, no matter is gain or loss, does it simply account as: income - expenses --> taxable income?
Please help me out.

 

[ccc]

Try to be clarified between self-employment and incorporation(only me, no other employee).
For income tax, no matter is gain or loss, does it simply account as: income - expenses --> taxable income?
Please help me out.

自雇（小企业）同有限公司，区别大了。计算纯收入，报税，区别很大，没有那么简单。等有空再多打几行。

如果不懂，最好花钱请人帮助做第一年的。

 

[ccc]

Mostly people would report business losses from using cars, or business use of houses including utilities fees because those "self-employed" won't really put money in the business. But CRA said that you can only deduct car use in business, the cost of business use house can only be deducted from business income...

Also remember what you do as your "self-employment" has to be a valid business...CRA is putting more man power to mend the fence, and don't think you are clever than the "government"...

是的。自雇，如果你只有一辆车、在家办公，必须按生意上使用、占用的比例，将费用按比例记入开支。例如，汽车须有生意上用车的里程记录；请人吃饭（一切招待费），只能报５０％；买台电脑，须分三年折旧记入开支。简单说，一旦税务局查你，一切须有实据，合法且具合理性。