Yes, all tips and donations received by a Twitch streamer are taxable income in Canada, whether these amounts have been received directly from your Twitch account, or indirectly from your fans paid to your PayPal account.
The Canada Revenue Agency has a dedicated explanatory page regarding tax compliance for social media influencers and streamers.
How do Twitch streamers pay taxes? See our detailed Canadian Tax Guide.
Twitch Income That Is Taxable in Canada
Anytime you are carrying on a business through social media channels or digital platforms, such as Twitch, you must report all income, both monetary and non-monetary, on your personal income tax return, and specifically on form T2125 “Statement of Business or Professional Activities”.
Income earned from any of the below items must be reported on your tax return:
- Subscriptions to your channel
- Advertising income
- Sponsorship income
- Merchandise sales or commissions on sales
- Tips and donations
- Perks such as products, clothes, trips, games, or other gifts
- Referral codes
We recommend you open a separate bank account to receive and track your Twitch income to make tax time a bit easier.
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Twitch Expenses That Are Tax Deductible
While you must include all of the above listed items as taxable income, you are also entitled to a deduction for expenses incurred that relate to earning that income. Some things that you may deduct from your Twitch income include, but are not limited to:
- Business use of home expenses
- Office expenses
- Internet costs
- Cell phone costs
- Professional fees
- Vehicle and mileage
- Travel costs
- Data storage and subscriptions
- Bank account and credit card fees
- Gaming hardware, systems, and games
- Computer hardware and software
- Camera equipment, webcams, lighting
Consult a Tax Professional
As a Twitch streamer, you should ensure that you consult your tax professional to ensure that you have adequately reported all of your income from all sources and ensure that you are fairly taking a deduction against this income.