Going Self-Employed in Canada? Marcus Got a $14,200 Tax Bill He Never Saw Coming

Marcus left his union job to run his own electrical contracting business. He had a strong first year — $85,000 in revenue — and figured he'd owe roughly what he used to pay as an employee. His accountant handed him a tax summary showing $14,200 owing. Nearly $7,400 of that was Canada Pension Plan contributions he had never budgeted for. When you work for yourself, you pay both sides of CPP. Nobody tells you.

This video covers why self-employed Canadians pay 11.9 per cent of net earnings in CPP instead of 5.95 per cent, why the June 15 filing extension does not extend the April 30 payment deadline, and the 30 to 35 per cent savings habit that eliminates the surprise entirely — plus the vehicle logbook and home office deductions on Form T2125 that can meaningfully reduce the bill.

April 30 is 16 days away. If you are in your first or second year of self-employment, open a CRA savings account today and move 30 per cent of every payment into it.

#canadiantax #CRA #taxseason #selfemployed #CPP #T2125 #freelancetax #filenorth

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