How To Turn Your Hobby Into A Small Business
When wondering how to turn your hobby into a small business there are many ways one could go about doing so. One solution is incorporating and registering a business name, but there is also an alternative and here is what you should know.
If you have a few clients, or none at all, but you are actively seeking for new ones, you are considered a legitimate business. You do not need to set up a corporation, nor do you need to register a business name, the Canada Revenue Agency will consider you as a Sole Proprietor and there are many benefits associated with it.
Let’s say you’re into filmmaking and you spend money on a professional camera, video editing software, or you register for an online marketing course, all of these expenses are tax deductible.
Even if you did not have any sales or earn income in that tax year, you can use those expenses to reduce the income from other sources including your day job or carry that loss to the next year.
Note it is important to keep track of all of your expenses, save all the receipts, and let your accountant know about your side business.