Or can you be a cottage seller and still have a presence on an On Demand App
Have you ever thought about starting a business but then backed off because the regulations involved just seemed so complicated? Between registering your business with CRA, charging and remitting HST and all the other things that come with being an entrepreneur, perhaps it just seemed like too much. Well, the beauty of selling on an on-demand app is that you don’t have to be a business in the traditional sense.
Just take a look at apps like Uber, Instacart, Rover and so on. The sellers on these apps are primarily people who are moonlighting and making some extra cash on the side. The app connects them with people who want to use their services, so there is no need for a physical address, marketing or many of the other things that ordinarily come with running a business. Furthermore, because most of them make less than $30,000 through these apps, they are not required to register for an HST number.
What Is Required of Sellers Using On-Demand Apps?
So now that you know what isn’t required of sellers using on-demand apps, you may be wondering what is required. Well, for the majority of these apps, you will need to be mobile. You’ll either need to have a car or access to some other form of transportation to help you get to the buyer.
Whether you are going to a buyer’s home to walk their dog, do their makeup for a big event or give them a massage, the “on-demand” part of the on-demand app will require that you get to the buyer in a timely manner.
Of course, even to this there are exceptions. With Airbnb for example, the buyer will be coming to you instead of you going to them.
And of course, certain specialized on-demand apps with have their own unique requirements. An app for at-home car repair for obvious reasons will require that sellers be licensed mechanics; an app for in-home massage may require sellers to by RMTs, etc.
When do Sellers Using On-Demand Apps Have to Register Their Business?
Any seller, no matter how big or small should be reporting their on-demand app income when they file their taxes. As long as your seller income stays small however, there is no need to register for an HST number.
If however, you become a wild success and start pulling in more than $30,000 per year, you will need to register with CRA to get an HST number.
Learn more about collecting and remitting taxes here.
If you are unsure how to register for your number or calculate your HST remittance, it is a good idea to sit down with an accountant or bookkeeper to make sure that this gets done properly and you don’t end up having to pay penalties down the road.