The new economy brings with it new tax filing considerations that weren’t even on most tax filers’ radar a few years back. With just over a week to go until the 2017 tax filing deadline, let’s review some of the tax rules concerning the gig economy, as well how to deal with cryptocurrency transactions.
Did you drive for Uber or Lyft in 2017?
If you drove for a ridesharing service in 2017, you need to report any income you earned from that activity as self-employment income on your return. The good news is that, as a self-employed taxpayer (or their spouse or partner), you actually have until June 15, 2018 to file your return; however, any taxes owing for 2017 must still be paid by April 30, 2018 to avoid non-deductible arrears interest, charged at the current prescribed rate of 6 per cent.
Of course, you can deduct appropriate, reasonable expenses against your ridesharing income. For example, you can deduct a percentage of your car’s maintenance expenses (gas, oil, windshield washer fluid, tune-ups, etc.), vehicle insurance, tolls or parking costs, cell phone expenses, ridesharing booking fees and any “freebies” you give to riders, such as water or candy.