Uber and Airbnb make tax time tricky for Canadians

For years, Alison Cullinghamrented out rooms of her Halifax home on an informal basis and didn't declare the rental income from it.

Once Airbnb came along, that changed her approach.

"People review you and you have to keep a really clean house so I realized I needed to do a renovation, I needed to hire a cleaner, I needed to start spending a whole bunch more money in order to keep those earnings going," said Cullingham.

It was at that point she started thinking about taxwriteoffsand decided to declare her rental income to the Canada RevenueAgency(CRA).

Who needs to claim business income?

According to Statistics Canada, Cullinghamis one of 69,000 Canadians who rentout space in their homes to others through some kind of peer-to-peer network.

ToddHarrison specializes in filing taxes for individuals and businesses. He said there's a lack of understanding about who needs to claim business income.

"People think only the guys out there doing roofing or that are full-time consultants or have their own business are self-employed, but anyone who sellsArbonne,Scentsy,Epicure, as well asAirbnborUber, they're all considered self-employed," he said.

Harrison saidmany people likely don't pay taxes on money earned through those means, but they should.

"Generally speaking, all the income you earn in pretty much anyendeavouryou could imagine in Canada is taxable," he said.

When it comes to what is known as the"sharing economy," Statistics Canada says overall spending on peer-to-peer ride services and accommodations totalled $1.3 billion last year.

What to write off

Sometimes, the way sharing economy companies are structured can help people keep track of their income and expenses. Vijay Kumar is an Uber driver in Scarborough, Ont., who does it to supplement his income from his job in the hotel business. He saidUberhas provided him with a full accounting of his earnings.

"And then on the other side, they'll give me something that says other potential deductions," he said, pointing to things like Uber service fees and the amount of mileage travelled.

Even with all that info, Kumar is unsure of what he can write off as a business expense.

This is one of the complications with the sharing economy things you use to make money like your car or your home arealso used for personal reasons.

At Cullignham'shouse, she saidthe only place off limits to guests is her own bedroom, which means four-fifths of her house is used for business. As a result, she writes off four-fifths of her expenditures.

As forKumar, he says he'll use an accountant for this tax season to make sure he's sharing what he's supposed to with CRA.