Tax considerations for e-commerce business owners


E-commerce businesses are becoming more and more popular with every year and many Canadians have deciding to forego the brick-and-mortar business plan for one that allows them to stay at home and online. But there may be tax considerations to think about when running an e-commerce business. Here are a few things to think about:


Is incorporation a benefit?

Because e-commerce businesses tend to be smaller than other offline companies, the owners may think that they are too small to incorporate, or that incorporation may not benefit them. But if the company is selling across Canada, or internationally, there may be tax benefits from incorporating. Contacting an experienced accountant, such as Naicker & Associates, can help answer those questions.


What taxes do you charge?

If you’re selling to an out-of-province customer or client, you must know when and what sales taxes to charge. If you’re running up-to-date commerce software, all of this information should be programmed into it. But with every year changing, you need to ensure that it’s accurately set up for 2018 and beyond.


What employment taxes do you need to pay?

One aspect of many e-commerce businesses is that any employees they have may have never actually set foot into any sort of building. One common mistake that the company owners make is by assuming these employees are all contractors. Depending on the work and how they are being paid, they may, in fact, be regular employees and the owner is required to pay payroll taxes and make pension contributions. If your employee is in another province, you will have to worry about the tax laws there.


Finding a tax specialist who can help answer these questions, whether you’re in Burnaby, Port Moody, or anywhere in the Lower Mainland, can take the stress and worry out of this. Contact Naicker & Associates and we’ll provide all the answers.