Quick Answer
All income received through Stripe or PayPal is fully taxable in Canada. Report it as business income on Form T2125. The CRA requires accurate records of all transactions — and since 2023, payment processors report large-volume seller data to the CRA directly.
Using Stripe or PayPal to receive payments doesn't change your tax obligations — it just means you have another source of income to report. Here's exactly what the CRA expects.
Stripe Income and the CRA
Stripe deposits are net amounts after Stripe processing fees. Your gross revenue is the full amount charged to customers before Stripe's fee. Stripe will provide you with a monthly summary report and a year-end summary — use these to report gross income and deduct fees.
PayPal Income and the CRA
PayPal income is treated identically. Gross income = all amounts received. PayPal fees are deductible. Download your PayPal monthly statements and reconcile them to your gross receipts. PayPal issues 1099-K statements for US tax purposes — for Canadian CRA purposes, use your PayPal transaction history.
GST/HST on Stripe/PayPal Transactions
If you're registered for GST/HST, you must identify and track GST/HST collected on each transaction through Stripe or PayPal. Most e-commerce sellers configure their checkout to calculate and add GST/HST on top of the product price — that total (including tax) is what Stripe or PayPal processes.
New CRA Reporting: Payment Processors Must Report Seller Data
Under the Digital Economy Measures Act (effective 2021), payment platforms operating in Canada including Stripe and PayPal must report gross payment volumes and seller information to the CRA above certain thresholds. If your reported income doesn't match what these platforms report, expect a CRA inquiry.
MaxRefund Handles CRA Reporting for Stripe and PayPal Income
We reconcile your Stripe and PayPal income, categorize expenses, and ensure your CRA filings are accurate and complete.
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