T2125 Statement of Business or Professional Activities: Who Qualifies and What You Get
Learn how to use the T2125 form to report your business income and claim necessary expenses on your Canadian tax return.
The T2125 is a tax form used by self-employed individuals to report their business or professional income and expenses.
Who it's for
This form is for sole proprietors who need to report business income on their personal tax return.
What you get
You use this form to list your business revenue and claim the various expenses you incurred while running your business. This helps ensure you are only taxed on your actual business profits.
What it costs you
There is no fee to use this form. However, it must be completed and attached to your annual personal tax return.
The catch to know
The most common reason for a review by the government is mixing personal expenses with business expenses. To avoid issues, keep your business and personal spending strictly separate.
How to apply
- Gather all your records regarding your business income and expenses.
- Complete the form detailing your professional activities.
- Attach the completed form to your annual personal income tax return.
- Review the official portal for the most current forms and instructions: https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t2125.html