CRA: Business Registration Online
Get a Business Number (BN) and register for GST/HST, payroll, import/export. Takes about 20 minutes online. Free.
CRA: Business Registration →Stage · Self-employed money in Canada
Setup: from side-hustle to legitimate business
The administrative first step. Most Canadians start as sole proprietors; that's the default and it's usually right until net income exceeds roughly $80,000. The goal of this stage is clean books, clean bank accounts, and CRA registrations ready before you exceed any threshold.
What to do this week
- Open a dedicated business bank account. Even as a sole proprietor, separating business from personal is non-negotiable for taxes, audit, and sanity.
- Get a Business Number (BN) from CRA. Free via the CRA Business Registration Online portal. Required for GST/HST, payroll, import/export.
- Set up a simple bookkeeping system. Wave (free), QuickBooks, FreshBooks, or a spreadsheet with rigid discipline. Track every inflow and outflow in real time, not at year-end.
- Register your business name with your province if you're using anything other than your own legal name.
- Buy commercial liability insurance if client work exposes you to any risk. Running without it is a single-client lawsuit away from catastrophe.
What to avoid
- Mixing personal and business transactions. One co-mingled bank account creates hours of cleanup and triggers CRA suspicion on audit.
- Skipping GST/HST registration because 'I'm not over $30K yet.' Track revenue across four rolling calendar quarters (not just calendar year). Once you cross, you have 29 days to register.
- Incorporating too early. Incorporation costs $200–$1,500 to set up and $1,000–$3,000/year in compliance. Below ~$80K net income, sole prop is almost always cheaper and simpler.
- Cash-only transactions to 'keep it simple'. Undocumented income is a criminal offence; CRA treats gig-platform income as reported regardless of your records.
Calculators for this stage
Forms to file at this stage
Provincial business name registration
If using any name other than your legal name, register with your province (ServiceOntario, Corporate Registry BC, Registraire des entreprises Quebec, etc.).
Frequently asked
Do I need to register a business name if I use my own name?
No. Sole proprietors using their full legal name (no 'Co.', 'Services', or modifiers) don't need to register a business name. Any modifier or trade name requires provincial registration. Registration typically $60-$80 and must be renewed every 5 years.
Can I write off my gym, my clothes, or my phone?
Mostly no. CRA allows expenses that are 'incurred to earn business income.' Gym memberships and regular clothing fail this test. Mobile phones used partly for business can be prorated by business use percentage. Be conservative, inflated personal expenses are the most common audit trigger for self-employed Canadians.
What's the difference between revenue and profit for tax purposes?
You're taxed on net income (revenue minus allowable business expenses). Revenue determines GST/HST obligation and some program thresholds; net income is what drives personal tax and CPP. Track both separately from day one.
How do I know if I'm a contractor or an employee?
CRA uses a 4-factor test: control, tools, financial risk, integration. A consultant with multiple clients, own tools, and no employer supervision is self-employed. Someone with one 'client', fixed hours, and employer-provided equipment is likely an employee, even if paid via invoice. Misclassification has serious tax consequences for both sides.
Next stage
Ongoing: discipline, installments, deductions →