 What's up everyone? Takedown here. Welcome back to another video since it is tax season. Today we're going to be talking about filing your taxes for your YouTube earnings. Let's get right into this. So for me personally, this summer of 2020 is whenever I started to get ads on the channel and started to make a small income. Of course, nothing to replace a full-time job, but it was something enough that I do have to report it for my taxes this year. This is going to be the first year that I have to claim taxes because the summer of 2020 is whenever I started to make income on YouTube and I have to claim it for my taxes this year. Now, I did not know anything about how to do this and what I was able to claim as obviously the income, which is easy to determine, but also what I can claim as expenses. Luckily, I'm in a few Facebook and Reddit groups for YouTube and a lot of people were very generous in helping me out on how to file my taxes this year when it comes to my YouTube earnings. The first thing I want to mention is I am a Canadian YouTuber, so I do have to file my taxes with the CRA. Now, depending on where you live and how you file your taxes, the forms and how you file your taxes might be different, but I believe the principles of what you can claim for your expenses should be the same. Here in Canada, any way that you make money online, you have to report it to CRA on your income tax because you would count as a small business. Even though you're an online business and even with YouTube, you count as a small business. Back in, I believe 2018, I might be wrong, but I believe it was 2018, CRA was making eBay and YouTube reports their Canadian users, all of the money that they paid out to them. So, CRA already knows how much you earned for eBay, YouTube and other online sites, so it's best that you report them whenever you file your taxes. Not doing so could land you in a lot of heat. One thing I found out is you can actually claim expenses for your business. For example, if you, for YouTube, purchased a camera, lights, tripod or any equipment including editing software or anything like that, that counts as expenses for your business. Anything that you also purchase to unbox or review for your channel also counts as expenses for your business, but you also have to keep in mind that there's a fine line between expenses for the business and expenses for your hobby. For example, if you purchased something to review on your channel and it was $50, but your channel got zero views, which means it made no money, that honestly can't be counted as a YouTube expense because it didn't actually occur for the business sign. It didn't make any money, so you didn't spend that $50 to make money, you just spent it to make a YouTube video and it didn't in turn make any money for the business side of things. Now, you can still claim those, but you also want to keep in mind that CRA may question some of your expenses if your expenses are higher than your income for multiple years. Here in Canada, I think the CRA is okay with three to four years of your business not making a profit and that is realistic because there is a lot of startup costs with any business, but you have to keep in mind that you can't claim every single thing when you fire taxes for YouTube. For example, for your YouTube, if from your start to your end you earned $1,000, but your expenses were closer to $5,000 if you purchased cameras, equipment, or things to unbox on your channel, CRA is eventually going to question that, whereas if your earnings were $1,000 but your expenses were about $1,200 to $1,500, that's more realistic and they would be more okay with that and likely not raise any red flags. The goal for any YouTuber is to make profit, so down the line you would want to make more profit than your expenses, but you have to keep in mind that with YouTube, they don't take taxes off of you, so expect, if you're on YouTube, expect some of your earnings to have to be paid back for taxes when tax season does come. So of course, I recommend claiming your YouTube earnings on your taxes so you don't get burned down the road. Now, of course, everybody's goal is to try to make more profit on YouTube and your goal with any business is to make more income than your expenses. That to me is common sense, but of course, you have to keep in mind your first few years, especially starting on a YouTube, you're going to be purchasing more things for not only quality of your videos, but also things for the business side of things and you can claim those as expenses, which is something I didn't realize prior to starting my taxes this year. Now for your taxes, when it comes to YouTube, it also depends on where you live. Certain areas have it where if you only earned a certain amount or less, you don't have to claim those taxes, whereas if you earn over that certain amount, you do have to claim those taxes. So you definitely want to look in your area and see what your regulations are whenever it comes to taxes of what you have to claim, but it's always better to claim your YouTube earnings, especially here in Canada, because YouTube, eBay and any other online sites do report those earnings to CRA. So CRA already knows that you earned that money the past year. If you guys have any other questions for how to do your taxes with YouTube earnings, let me know in the comments down below. I will help you guys out. I myself use simple tax, which is very easy. So you basically go on and you do apply as if you are a regular business under that section. For the industry code, you're going to put motion picture and video production. So now all you have to do is go in the income section and fill that out. You just go on your YouTube and you can find out what you earned the past year to file your taxes. And then you have to go through your expenses. So easy ways to do this is to go through your channel for what you uploaded the past year, see what you purchased for videos to upload, and then also think about the equipment you used, any editing software that you purchased or anything like that. And you can claim those as expenses along with things like rent if you do rent an area, what percentage of your house is used for YouTube and stuff like that. You can claim that as well, which was very helpful. For me personally this year, I did have to owe, but that's because of COVID-19. Fortunately, once I put in my YouTube earnings, because my YouTube earnings, my expenses were about $300 more than my income, it actually saved me about $70 on my taxes, which was very, very helpful. So I'm definitely glad I did file my taxes and claim YouTube this year. I knew I had to anyways, but I'm glad I did that. So I highly recommend doing so, especially if your expenses are higher than your income, it might lower your taxes for the year. Now of course, down the line, if five years go by and your expenses are still way, way higher than your income, CRA may question that down the road. But you have to remember a business starting out is always going to not make profits for about three to four years and CRA expects that. So I hope you guys enjoyed this video and I hope you guys know a little bit more about filing your taxes and why it is important to claim everything for YouTube and why it is important to keep track of your expenses that you purchase for YouTube for the business side of things. So you can claim those as well because that could help you down the line. I'll see you guys in another video. If you guys will have any questions, let me know down below. I will try to help you out the best that I can, but you have to remember I am a Canadian YouTuber, so I can't help you with the American format, but it should basically be the same principles where your income and expenses keep track of that and you should be able to file it. Just the forms might be different than I use, which is simple tax. I'll see you guys in the next video. Please take care and peace.