June 5, 2018
By Court Order, PayPal is now required to provide CRA ( Canada Revenue Agency) with information on all the Canadian Business Accounts.
Here is a list of things you need to do if you have been accepting payments through PayPal :-
- Make sure that all the revenues are reported to the CRA in all your past, present and future tax returns. For the past returns if you want you can go ahead and make a voluntary disclosure by filing a T1Adj. We would suggest consulting with your CPA.
- As there could be lot of implications for unreported revenue, few of them are listed below:-
- If your revenue for PayPal was more than $30K then you would have to register for GST/HST and should have to collect, report and remit GST/HST to CRA. Consult your CPA for applicability on your business.
- In 2014, CRA introduced a Schedule 88 to be filed with your corporation return which essentially relates to disclosing your website and any online sales you generated through that website. If you have in the past failed to report on Schedule 88 then we would suggest filing it now because there can be a possibility of CRA audit.
Have a website but no online sales?– If your business has a website but does not sell products online and all services are provided through the office. If the website generates more business through marketing or online presence or may be from traffic on the website, in this case since products are not being sold online there isn’t a need to file the Schedule 88. But as CRA isn’t looking at this right now, and you never know when they will start, we would recommend it’s better to file the schedule even if it’s not necessarily a requirement.
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