Lines 13499 to 14300 – Self-Employment Income — Montreal CPA Firm Near You: How to Report Business, Professional, Commission, Farming, and Fishing Income

Self-employment income is one of the most complex areas of personal tax filing. If you earn income from a business, profession, commission work, farming, or fishing, you must report it correctly on lines 13499 to 14300 of your personal income tax return. Because these lines flow directly to CPP calculations, GST/QST obligations, and your total taxable income, errors can lead to reassessments, penalties, or missed deductions.

This guide explains what counts as self-employment income, how to report it, how government subsidies and loans are treated, how partnership reporting works, and what forms you must complete to support the calculations. Whether you are a sole proprietor, contract worker, gig worker, professional, or partner in a business, understanding these rules is essential.

Legal and Regulatory Framework

Self-employment income includes all income earned from activities carried on for profit or with a reasonable expectation of profit, such as:

• Running a business

• Practicing a profession

• Earning commissions

• Farming operations

• Fishing operations

The Income Tax Act defines a business broadly. A business includes:

• A profession

• A calling

• A trade

• A manufacture

• An undertaking of any kind

• An adventure or concern in the nature of trade

Employment income is not business income. Self-employment income is reported on lines 13499 to 14300, depending on the type of activity.

To calculate and report your business income (or loss), the CRA requires detailed documentation through Form T2125 – Statement of Business or Professional Activities or, for farming and fishing, the applicable self-employment forms.

Guide T4002 – Self-employed Business, Professional, Commission, Farming, and Fishing Income provides detailed instructions on calculation, deductions, industry codes, and enhanced CCA rules.

Key Court Decisions

Courts have clarified that:

• A business must have a reasonable expectation of profit

• Self-employment income cannot be disguised employment income

• Expenses must be reasonable and directly related to earning income

• CRA is entitled to deny deductions unsupported by documentation

• Partnerships must properly allocate income among partners

• Capital cost allowance must follow CRA class limits and rules

Judgments consistently emphasize that taxpayers must maintain adequate records, including invoices, receipts, contracts, mileage logs, business records, and partnership agreements. Courts also uphold CRA’s authority to reassess if income is underreported or if expenses are improperly claimed.

Why CRA Targets Self-Employment Income

Self-employment income is one of the CRA’s highest-risk audit categories. CRA closely reviews:

• Underreported income

• Overstated deductions

• Missing receipts

• Motor vehicle and home office claims

• Unreported online sales

• Cash-based businesses

• GST/QST mismatches

• Inconsistent reporting from year to year

CRA also cross-checks:

• Bank deposits

• Payment processor records

• T5013 partnership slips

• GST/QST filings

• Third-party reporting

• Taxpayer lifestyle indicators

Accurate, well-supported reporting reduces audit risk.

Mackisen Strategy

Mackisen helps self-employed individuals, professionals, and partners calculate and report their self-employment income accurately. Our approach includes:

• Completing Form T2125 properly

• Ensuring all income sources are reported

• Maximizing allowable deductions

• Allocating expenses correctly

• Reconciling bank deposits with reported revenue

• Determining GST/QST obligations

• Filing Form T1139 when required

• Handling partnership allocations

• Calculating CPP contributions on self-employment earnings

We also provide audit-ready support to ensure your filings survive CRA review.

Real Client Experience

A consultant failed to include a forgivable portion of a government COVID-19 subsidy. Mackisen corrected the return, reported the forgivable portion, and avoided a reassessment.

A contractor reported inconsistent income across GST/QST and Form T2125. We reconciled the amounts and corrected year-end reporting.

A partner in a construction business received no T5013 slip and was unsure how to report their share of income. Mackisen prepared the appropriate partnership allocation using partnership financial statements.

A small business owner kept no records of cash sales. We reconstructed income using bank deposits and industry averages and filed compliant returns.

Reporting Self-Employment Income on Lines 13499 to 14300

These lines cover all types of self-employment income. You must report:

• Gross income

• Net income (loss) in brackets if applicable

Income includes:

• Business sales

• Professional fees

• Commission earnings

• Farming revenue

• Fishing sales

• Subcontractor payments received

• Online business revenue

• Platform-based gig work

Government loans generally are not taxable, but any forgivable portion becomes taxable in the year it is earned.

Government subsidies—such as those under the CRHP, THRP, or HHBRP—must be reported on the return for the tax year they are considered “received.” These subsidies are considered received on the last day of the claim period they relate to.

Form T1139 – Year-End Reconciliation

If you want to maintain a business year-end that does not align with December 31, you must file:

Form T1139 – Reconciliation of 2024 Business Income for Tax Purposes

This form reconciles fiscal year vs. calendar year reporting. Failure to file it results in CRA adjusting your year-end automatically to December 31.

CPP Contributions

Self-employed individuals may need to make CPP contributions on their net self-employment income. This is calculated on:

• Line 22200 – Deduction for CPP or QPP contributions on self-employment income and other earnings

• Along with employer and employee equivalents

CPP contributions are mandatory once net business income exceeds the basic exemption threshold.

Partnerships – How to Report

Reporting depends on whether you were an active partner or a limited/non-active partner.

Limited or Non-Active Partners

Report:

• Net rental operations on line 12600

• Net farming income on line 14100

• Other net income or losses on line 12200

Active Partners with a T5013 Slip

Report:

• Gross amounts from boxes 118, 121, 123, 125, and 127

• Net income or loss from boxes 101, 103, 116, 120, 122, 124, and 126

Active Partners Without a T5013 Slip

Follow Form T2125 or the partnership’s financial statements to calculate your share of:

• Net income or loss

• Capital cost allowance

• Expenses incurred personally

Attach a copy of the partnership’s financial statement or applicable forms when filing a paper return.

Subsidies, Loans, and Special Situations

Government Loans

Loans are not taxable, but the forgivable portion is taxable in the year received.

Subsidies

Subsidies must be included in business income in the year they are considered earned.

Tax Shelters

If you participated in a tax shelter, you must file additional forms. Special reporting rules apply.

Common Questions

Is cash income taxable?
Yes. All business revenue must be reported.

Do I need a T2125 for each business?
Yes. Separate T2125 forms are required for each business or professional activity.

Where do I report gig-economy income?
Under business or professional income on lines 13499–14300.

What if I have a loss?
Report it in brackets. Losses may offset other income, subject to rules.

Do partnerships always issue T5013 slips?
Not always. Smaller partnerships may not issue slips; use financial statements instead.

Do I have to pay CPP on self-employment income?
Yes, if your net self-employment income is above the basic exemption.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps businesses stay compliant while recovering the taxes they’re entitled to. Whether you're reporting self-employment income, claiming business deductions, or navigating partnership rules, our expert team ensures precision, transparency, and protection from audit risk.

If you earn self-employment income, Mackisen can calculate your gross and net income properly, prepare Form T2125, optimize deductions, and protect you from CRA reviews.