A self-employed worker is an individual who creates his own job. From a tax point of view, he is considered to be operating a sole proprietorship for his own account.
The income of the self-employed person is considered “business income”. However, this does not mean that it is obliged to register as a company or in any way. Self-employed workers are under no obligation to register their name. He does not have to file a separate tax return for his business activities. Like the average person in Quebec, he produces two annual tax reports: one for the federal government and the other for the provincial government, adding a few schedules for business income. Using the turbotax alternatives is useful there.
Self-employed worker, is this a special tax status?
No. It should be understood that from a fiscal point of view, a citizen has only one status: that of self-assessed taxpayer, that is to say a taxpayer who declares his income on his own. In an income tax return, these can come from totally different sources for a single individual: salaries, business income, investment income, employment insurance, etc. What is important, to avoid problems, is to declare all your income, regardless of where it comes from.
If I am an employee, can I also declare myself self-employed?
Absolutely, nothing prevents a taxpayer from combining wages and self-employment. According to our survey, this is what 19% of Quebec visual artists do. These artists supplement their creative income with jobs that often allow them to make ends meet and reinvest in their practice.
As a self-employed artist, can I deduct my expenses?
Of course. We have already explained that the income of the self-employed worker is considered “business income”. Like any business, you are allowed to deduct all of your expenses incurred to earn income.
These expenses are, for example, the raw materials and artist’s materials that you need to create; the purchase of books or other supplies required by your artistic activity; rental costs for your workshop (rent, heating, electricity, telephone, insurance); framing, storage and shipping costs for the works; equipment usage fees; the remuneration of people you employ in connection with your activity as an artist (accountant, agent, photographer, workshop assistant, translator, graphic designer, carpenter, etc.); the marketing or distribution costs that you incur to sell your works (varnishing costs, catalog publication, printing of invitations, hosting of a website, research or promotional trips, entertainment expenses), etc.
All these expenses must be supported by documents or receipts and they must be reasonable, whether in nature or in amount. The annual amortization of the cost of equipment parts is also acceptable as an expense.