This guide reflects the rules for the tax year ending December 31, 2025.
It applies to individuals filing their 2025 tax return in 2026.

If you earn income from freelancing, contracting, gig work, or running your own business, the CRA considers you self-employed. Filing taxes as a self-employed individual is different from filing as an employee, and this guide walks you through everything you need to know for the 2025 tax year.

🧭 1. Who Is Considered Self-Employed?

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You are self-employed if you:

• Run a business on your own
• Work as a freelancer or contractor
• Earn gig income (Uber, DoorDash, Instacart, etc.)
• Sell goods or services independently
• Operate a side business while employed

Self-employed individuals must report business income and expenses using Form T2125.

📅 2. Tax Deadlines for Self-Employed Individuals (2025 Return)

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• June 15, 2026 — Filing deadline
• April 30, 2026 — Payment deadline

Even though you can file later, any balance owing is still due April 30.

💼 3. How to Report Self-Employment Income

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Self-employment income is reported on:

• Form T2125 — Statement of Business or Professional Activities
• The net income flows to Line 13500 of your T1 return

You must report:

• Gross business income
• Cost of goods sold (if applicable)
• Business expenses
• Capital cost allowance (CCA)
• Home office expenses
• Vehicle expenses

🧾 4. Business Expenses You Can Deduct

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You can deduct reasonable expenses incurred to earn business income.

Common deductible expenses:

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• Advertising
• Office supplies
• Software and subscriptions
• Internet and phone
• Professional fees (legal, accounting)
• Bank fees
• Business insurance
• Meals (50%)
• Travel
• Equipment
• Tools
• Training and courses

🏠 5. Home Office Expenses

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If you work from home, you can deduct a portion of:

• Rent
• Utilities
• Internet
• Property taxes
• Home insurance
• Mortgage interest (business-use portion only)

The percentage is based on workspace size and usage.

🚗 6. Vehicle Expenses

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If you use your vehicle for business, you can deduct:

• Fuel
• Insurance
• Repairs
• Maintenance
• Lease payments or CCA
• Parking

You must keep a mileage log.

🧮 7. CPP Contributions for Self-Employed Individuals

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Self-employed individuals must pay both the employer and employee portions of CPP.

For 2025:

• CPP rate: 11.4% (combined)
• Applies to net self-employment income
• Up to the annual maximum pensionable earnings

CPP contributions are calculated on Schedule 8.

💸 8. GST/HST Registration Requirements

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You must register for GST/HST if:

• Your worldwide taxable revenues exceed $30,000 in any 12‑month period

Once registered, you must:

• Charge GST/HST
• File GST/HST returns
• Remit collected tax

📉 9. Capital Cost Allowance (CCA)

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CCA allows you to deduct the cost of business assets over time.

Common CCA classes:

💰 10. Instalment Payments

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You may need to pay quarterly instalments if:

• You owe more than $3,000 in tax in 2025
• AND you owed more than $3,000 in either 2024 or 2023