Almost Half of Canadian Gig Workers Consider Not Declaring All Income Due to Rising Cost of Living: Survey

Uber services. Angelo Merendino/AFP/Getty Images

Canadians who work on the side or undertake contract work to boost their income are tempted to not declare all of their income, faced with rising costs of living and precarious finances, according to a new survey commissioned by H&R block.

Of those working a side hustle, almost 49 percent say they are willing to risk “not declaring ‘all’ their related income.” Another 44 percent are willing to risk not declaring ‘any’ of their side hustle income, according to H&R Block.

The income tax preparation company suggests that 28 percent (around 8,746,000) of Canadian adults reported working a “gig job,” up from 13 percent in 2022.

Twenty percent took on a gig job to boost their income over the last 12 months, and 63 percent cite rising inflation as a key motivator. Among 18- to 34-year-olds, 35 percent report working at a gig job.

H&R said gig jobs could include “transportation and delivery services like Uber and DoorDash, homestay services such as AirBnB and Vrbo, freelance and contract work—from dog walking to construction, and marketplace platforms like Etsy and Poshmark.”

“The survey indicates that many Canadians feel tempted to avoid declaring all their income from a side gig, and many lack an understanding of the tax implications,” said Yannick Lemay, Learning Program lead and tax specialist at H&R Block Canada, in a March 2 news release.

According to H&R Block, 85 percent of Canadians are concerned their income “is not keeping pace with inflation,” 74 percent of gig workers say the job is a “side hustle” in addition to their primary employment, while 26 percent report it as their primary source of employment.

Roughly half of gig workers, 49 percent, mention the side hustle to their primary employer, while 51 percent say nothing.

“It’s important to know that the CRA takes failure to report all income very seriously with potential substantial penalties. Bottom-line—not reporting all income at tax filing time is considered tax evasion and is a criminal offence in the eyes of the law,” states H&R block.

The tax preparer said “filing gig income opens doors to credits and benefits,” and might have tax advantages when contributing to a Registered Retirement Savings Plan (RRSP). "The good news is there are literally hundreds of potential deductions and expenses that can be claimed; many of which put money back into your pocket,” said Lemay.

According to the survey, 15 percent of those surveyed indicated they were thinking about taking on a future side job to help make ends meet, as consumers see prices rise for groceries, fuel, home heating, rent, and carbon taxes, among other costs of living increases.

“In the current economic context many Canadians are facing the biggest financial challenges of their lives,” according to a Feb. 13 report from the federal Financial Consumer Agency of Canada.

The survey was conducted online, in both English and French, from Feb. 14 to 16, with a national sample of 1,501 Canadians who are members of the Angus Reid Forum.