During tax time, discuss clients’ sharing economy activities

Are you familiar with the term “sharing economy”? If not, you’re behind the curve.

In a release, CRA recognizes the significant growth of this economy, which it says refers to “a technologically fuelled way to consume and access property and services. In this economy, communities pool, loan, and share their resources through networks of trust.” People are accommodation sharing through renting, for example, and are raising money through peer and crowd funding.

For those actively involved in the sharing economy, CRA stresses there are tax obligations that can’t be ignored. In its release, the agency says, “If you are an individual or a business participating […], you must report all the income you earn through sharing-economy activities. You must also meet your GST/HST reporting and remittance requirements.”

Read: Getting by in the sharing economy, for a list of tax tips

Failure to do so, CRA warns, means “you are participating in the underground economy and this could result in serious consequences.”

For more, read:

What the sharing economy means for your clients’ taxes

Investing in the sharing economy? Monitor these risks

More Canadians participating in the second-hand economy

Sharing economy is changing how Canadians spend

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.