Self-Employed Taxes and Invoicing in Canada
Guide • Canada • last updated October 2026
What self-employed Canadians need to know about invoicing and tax: GST/HST registration, income tax, and keeping records.
Being self-employed in Canada means handling your own tax and invoicing. This guide covers GST/HST registration, income tax basics, record-keeping, and key deadlines, so nothing sneaks up on you. Estimate your tax with the income tax calculator.
GST/HST registration
Once your revenue passes the small-supplier threshold, you must register for GST/HST, charge it on invoices by the client's province, and remit it. Registering also lets you claim input tax credits on business purchases. Confirm the threshold and deadlines with the CRA.
Income tax basics
Self-employment income is taxed at your personal rate, federal plus provincial, and you also pay both halves of CPP. Because tax is not withheld, set aside a portion of every payment so you are ready at filing time, and watch for instalment requirements.
Invoicing and record-keeping
Keep every invoice, receipt and expense record. Good invoicing software stores them for you and makes filing far easier. The CRA expects you to retain records for several years.
Key deadlines
Self-employed individuals generally have a later filing deadline than employees, but any balance owing is due earlier. GST/HST returns have their own schedule. Check the current dates with the CRA each year.
A worked example
A self-employed designer earning $80,000 sets aside roughly a quarter of each invoice for income tax and CPP, charges GST/HST to clients, and files a GST/HST return plus a personal return with business income.
Setting money aside as you earn
Because no one withholds tax from your invoices, the safest habit is to move a share of every payment, often around a quarter to a third, into a separate account for income tax and CPP. When filing time comes, the money is already there. As your tax owing grows, the CRA may require quarterly instalments, so watch for that.
Deductions that lower your bill
Legitimate business expenses reduce your taxable income: a home-office portion, software and subscriptions, equipment, professional fees, and business travel. Keep receipts and a simple log. If you are registered for GST/HST, you can also recover the tax paid on many of these through input tax credits.
CPP and the self-employed
As your own employer, you pay both the employee and employer portions of CPP on your net self-employment income. It is a meaningful cost that salaried workers only pay half of, so factor it into your rates and your tax set-aside rather than being surprised by it at filing.
A self-employed tax checklist
- Register for GST/HST once you pass the threshold.
- Set aside tax and CPP from every payment.
- Track expenses and keep receipts.
- Watch for instalment requirements and filing dates.
Staying organized year-round
The self-employed who dread tax season are usually the ones who leave everything to the end. A light monthly routine fixes it: log income and expenses, file receipts, move tax and CPP into a separate account, and reconcile your GST/HST. An hour a month turns filing from a scramble into a formality, and it keeps you ready if the CRA ever asks questions.
Invoicing software that stores your invoices, tracks what is paid, and exports a clean summary does most of this for you, which is worth far more than the subscription at tax time.
Self-employed routine checklist
- Log income and expenses monthly.
- Set aside tax and CPP from each payment.
- Reconcile GST/HST each period.
- Keep records for at least six years.
Frequently asked questions
How much tax should I set aside when self-employed in Canada?
A common rule of thumb is to set aside roughly a quarter to a third of each payment for income tax and CPP, since nothing is withheld for you. Your exact rate depends on your income and province, so check with the CRA or use the income tax calculator as a guide.
Do I have to charge GST/HST when self-employed?
Only once your revenue passes the small-supplier threshold, after which registering and charging GST/HST is mandatory. Below it you can register voluntarily to claim input tax credits on business expenses.
What expenses can I deduct as a self-employed Canadian?
Legitimate business costs such as a home-office portion, software and subscriptions, equipment, professional fees and business travel reduce your taxable income. Keep receipts, and if you are registered for GST/HST you can also recover the tax paid on many of them.