For Income Tax purposes a business is an activity that one intends to carry on for profit and there is evidence to support that intention. A business includes; a profession, a calling, a trade, a manufacture, an undertaking of any kind, and adventure of concern in trade. You are required to file your business income on form T2215. You can use either cash basis or accrual basis for reporting income and expenses for tax purposes. Income tax law requires tax payers to keep track of the gross income your business earns. Gross income is your total income before you deduct any expenses, including those related to the goods sold. Your income records must include the date, amount, and source of the income. You are supposed to record income whether you received cash, property, or services. Support all income entries with original documents; such as, sales invoices, cash register tapes, receipts, bank deposits slip, fee statement, and contract. Similarly, make sure that you always get receipts or other vouchers when you buy something for your business. The receipt should show; the date of purchase, the name and address of the seller or supplier, the name and address of the buyer, full description of the goods or services, and GST/HST Number of the supplier. If you are employing any person, you will have to deduct appropriate taxes, CPP, & EI from the gross salary of the employee and remit it to CRA by 15th of the following month. You are also required to issue T4 & T4A Summaries by February 28 of following year. You will give a copy of the T4 and T4A to the employees to enable them to file their tax returns. You are supposed to pay any balance owing for last year’s tax to CRA by April 30 of the following year. By June 15 of the following year you will file your income tax return for your business. If you are not a corporation. For details you may like to study T4002. For your convenience a link is provided below.