Did you start your own business last year or pick up a freelance gig? Filing your taxes will be a bit different this year. In addition to entering all of your business’s income and expenses, there’s another piece of info that’s needed to complete your return. An industry code is a must-have for self-employed filers. If it’s your first time filing taxes as a self-employed individual, here’s what you need to know about industry codes.
What is an Industry Code?
An industry code is a 6-digit number used to identify the type of business you are operating (for tax purposes, all self-employment activities, even freelance work, are considered to be “business activities”). Everything from retail shops to housecleaning to pet sitting has a code to match. Industry codes are used by Stats Canada to keep track of business trends. Think of it as a census for business activities.
It is important to note that you must include your business’s industry code in order to submit your return electronically. If your industry code is missing, you will not be able to use CRA’s NETFILE service.
How Can I Find My Industry Code?
If you’re a TurboTax user, we’ve got you covered. When you come to the spot in your return to enter your industry code, use the Guide Me feature to find the code that best suits your business. Start with selecting the category of your business. Then narrow it down by subcategories to find the code that matches your business. If your business has more than one activity, choose the code that best describes your main activity
The Canada Revenue Agency maintains a list of codes for paper filers. If you are not using a tax preparation software to prepare your return, refer to that list here. Keep in mind that these numbers are only to be used if you are preparing your return by hand. If you’re using TurboTax to prepare your return but are mailing the finished return to CRA, use the industry code provided within the software.
None of these Codes Describe My Business!
With all the different self-employment ventures available, it would be impossible to have a code for each individual business. If you don’t find a code that exactly matches your line of business, there are catch-all options available. Look for the words “miscellaneous” or “all other”.
For example, if your business is breeding and selling gerbils, you won’t find an industry code for “gerbil breeders”. Instead, you would select the category Services, then the subcategory Agricultural or Animal Services. From the options that appear, code 112999 – All Other Miscellaneous Animal Production – would be the best choice.
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