If the words “tax season” send a chill down your spine, you’re not alone. Almost half (46 percent) of Canadian millennials don’t do their taxes on their own because they’re afraid to make mistakes, says a recent survey.
To make the process a little bit easier, we spoke to three millennial money experts and asked them 10 questions everyone has come tax time. With the tax return deadline fast approaching, their answers couldn’t be timelier.
Meet our three experts:
- Jordann Brown, @myalternateblog: creator of My Alternate Life. The 27-year-old personal finance blogger from Halifax paid off $38,000 in debt and now has $10,000 banked for rainy days and a net worth of $83,000.
- Jessica Moorhouse, @jessi_moorhouse: a personal finance blogger in Toronto and the voice behind the Mo’ Money podcast. She also runs v. popular Millennial Money Meetups.
- Desirae Odjick, @half_banked: an Ottawa-based marketer by day, personal finance blogger at night. The brain behind Half Banked is currently challenging herself to save 50 percent of her income (without giving up her daily latte).
Claim all of it—and if you’re thinking otherwise, remember Walter White, says Jessica Moorhouse. “Since it is income (even if it’s not your primary source), you do need to pay taxes on it. And contrary to popular belief, you don’t have to be incorporated for this to apply to you. I’ve been running my side business for years as a sole proprietorship under my name. It’s best not to risk the CRA going after you by getting paid under the table. Just think of how hard it was for Walter White in Breaking Bad to dodge the taxman with his under-the-radar income.”
Don’t forget Airbnb, says Desirae Odjick. “It’s definitely income. That means you’ll want to keep track of how much money you made [renting your place] in a year, either in Excel or in accounting software, so you have accurate records when it’s tax season. Not reporting that income, or reporting it as a guesstimate, is… wait for it… tax fraud. Yikes.”
Set $$$ aside throughout the year to cover your side gig, says Jordann Brown. “If you earn money on the side and you claim it on your taxes you’ll probably have to pay tax on it, so make sure to set aside 25–30 percent of your side hustle income for taxes.”
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