Reporting foreign income while self employed

[RRP1]

As a self employed graphic designer with an HST number where do I report foreign USA income on my tax return and am I required to file a USA tax return on this income?

[NazMusthafa]

Report your foreign employment income on line 10400 in Canadian dollars. Entering any foreign amounts into TurboTax varies, depending on the version of software you are using. Before you begin, there are a couple of general things to keep in mind:

• You must submit income, pension, and any other amounts in TurboTax, even if your amounts aren’t reported on T-slips.
• If the amounts on your foreign income slip are reported in a foreign currency, convert them to Canadian dollars before you enter them. If the amount was paid at various times throughout the year, use an average annual exchange rate.
• For foreign non-business income that is not on a T-slip (including US Social Insurance), do not convert the amounts to Canadian dollars before you enter them. TurboTax converts the amounts automatically based on the exchange rate you enter.

To start entering your slip amounts, follow the steps provided.

Instructions for TurboTax online users

1. Select Find* or the magnifying glass icon from the top menu.
2. Once the Find window opens, type Foreign slips, then hit enter.
3. Select  Foreign slips from the options that appear, then select Go.
4. When the Foreign Slips Summary step appears, add the amount for the slip you would like to claim.
5. Repeat the steps above for each new slip and amount you need to enter.
6. Select Continue at the bottom of the page when done.

As per CRA: Do not reduce your foreign income by the amount of tax the foreign country withheld. Instead, you may be able to claim a foreign tax credit when you calculate your federal and provincial, or territorial taxes. See line 40500 for Federal foreign tax credit.

For further information please click: Foreign employment income.