Am i legally required to report casual income? My husband built a deck for a friend and was paid cash with no T4. If it's optional we'd choose not to declare it.

CRA requires that you report "all income" you earn. If you earn "casual employment income" you can report it as "Employment Income not reported on a T4", as long as that amount does not exceed $3,500. If you exceed $3,500, you will then need to report this income as "Self Employed" income and possibly pay CPP contributions on it. 

https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/personal-income/line-104-other-employment-income/line-104-employment-income-reported-on-a-t4-slip.html

@TurboTaxKim  Where do you get the $3500 amount from? the link you posted does not mention any dollar amount.

Any clarification would be appreciated

 

Thanks,

@DavidGates 

Thanks for pointing that out 🙂 The CRA states "With very few exceptions, every person over the age of 18 who works in Canada outside of Quebec and earns more than a minimum amount ($3,500 per year) must contribute to the Canada Pension Plan (CPP)". 

For this reason, when you exceed that $3,500 threshold earning "other employment income", they consider this to be Self-Employment Income and in order to make those contributions, you must report the income as such.

 

• From the above link: You may be able to contribute to the Canada Pension Plan or Quebec Pension Plan for this income. See line 22200.

 

The following CRA link includes the $3,500 "net income" threshold where CRA considers you to be "Self-Employed": 

https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/canada-pension-plan-cpp/cpp-self-employed.html

 

"If your net self-employment income and pensionable employment income is more than $3,500, you will have to contribute to the Canada Pension Plan (CPP". 

 

Hope this cleared things up for you. Happy Tax Filing

 

 

I am a bit unclear about this.

 

This winter I walked dogs and sold some handmade items that totaled below $3,500 what line would I put this under?

 

If this is not considered self-employment income because it is under $3,500 what is it considered and where do I report it?

 

Thanks kindly,

You would report these on line 104, income not reported on a T4 slip.  

If you are using TurboTax Online- enter it under Other Employment Income. 

If i report casual income as self employed, how i can deduct expenses and do i need to pay CPP and EI?

CRA requires that you report "all income" you earn. If you earn "casual employment income" you can report it as "Employment Income not reported on a T4", as long as that amount does not exceed $3,500. 

 

Report on, line number10400 tips, gratuities, or occasional earnings you received that are not included in your T4 slips.

 

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