Q.How do I report my business income and which income tax forms do I need?
The way in which the income tax return you need to report your business income varies from the form of business you opt for. If you have a sole-proprietorship or partnership firm, you need to complete the FORM T2125, which replaces the old T2124 (Statement of Business Activities) and Form T2032 (Statement of Professional Activities) on your T1 income tax to report your business income. If you operate more than one business please note that you will have to fill out a separate FORM T2125 for each business. In case if your business is incorporated, a T2 income tax return (the corporate income tax return) will be used to report your business income and you will file for personal income tax return(T1) separately.
Q.My business is a partnership. What income tax form do I need to fill out?
However, if during the year of operation the business has had 6 or more partners, you will also be required to complete a PIR (Partnership Information Return). In such a situation, you will normally have a T5013 slip (Statement of Partnership Income) and then the appropriate sections of Form T2125 will be filled accordingly.
Q. I have a job as well as a part-time business. How do I report this?
It also include lines for the deduction of your business’s appropriate expenses. The income you earn from your job will be reported as usual on the first page in the appropriate lines of the T1 tax return (from the information on the T4 slip which is given to you by your employer). However your total income will be the sum of your business income and income from your job.