# Upwork Independent Contractor



## cicidemet (Nov 7, 2017)

Hello everyone,

I desperately need your advice on my issue. I am a recent landed Permanent Resident working with different companies located outside Canada on an online freelancer platform called Upwork. My title is an independent contractor and the job is done remotely on a virtual environment and I get my payment thorough Payoneer mastercard. My earnings can be withdrawn from any ATM without the need of an actual bank account for the money to be deposited.

Since the service I am giving is a virtual one which is being received outside Canada, I am not sure how I should proceed with my income taxation.

I am completely new to the tax system and I appreciate your thoughts on this.

Thank you


----------



## Spudd (Oct 11, 2011)

Check out this thread:
http://canadianmoneyforum.com/showthread.php/124346-Independent-Contractor-Tax-Filing


----------



## Nononymous (Jun 10, 2015)

I won't get into the details of which forms to fill out etc. - you'll have to figure that out for yourself. It's not difficult if you use a tax program or site like ufile.

Basically it works like this: You are self-employed. You fill out your tax return with your total income for the calendar year. You then deduct any business expenses (probably very limited if you're working online, but software license fees etc. count; if you've bought a computer you're supposed to depreciate but if it's nothing too fancy you can probably get away with claiming it all in one year). If you work at home then you go through the home-office deductions - take the percentage of the home you use for work (under 30 percent doesn't seem to raise any red flags with CRA) and apply it to stuff like rent or mortgage interest, property taxes, insurance, utilities, internet and phone, maintenance etc. Then you'll have your tax bill for the year. If you're making decent money it will be one big cheque, so make sure you're setting aside at least a quarter of what you're making now so that you can pay the bill. In future years they may require estimated quarterly payments (which at least means not scrambling to come up with $50k in one shot).

The above advice applies if you wish to be fully legal. Since you're earning money in a virtual/offshore environment, the government is entirely dependent on you reporting your income honestly. It's not like they can cross-reference to your GST filings if you were billing Canadian clients, or regular income from a Canadian employer. They won't have some automatic total of your ATM withdrawals, for that I imagine a fairly serious investigation is required. So it's up to you what you choose to report and how much risk you are willing to assume (given that you don't have citizenship, I might be inclined to do everything correctly - including reporting any accounts or investments you have in other countries if they generate income or exceed the balance reporting threshold).


----------

