You write code for clients — some of them outside Canada — on hardware you bought yourself. Here is how that maps onto Form T2125, what the GST/HST rules actually say about US clients, and the one incorporation question to check before you register a company.
Every invoice you collect — Canadian clients, US clients, Upwork or Toptal payouts — is self-employment income on Form T2125. There is no employer withholding, so tax, CPP contributions, and (in year two and beyond) quarterly instalments are on you. Two free tools give you the real numbers for your income and province:
Calculate my tax bill → Do I owe quarterly instalments?
These are the categories that show up on almost every developer's T2125, with the actual line the amount belongs on (line names follow the CRA's T4002 guide — the same canon our T2125 line reference documents):
| What you paid for | Where it goes | Worth knowing |
|---|---|---|
| SaaS subscriptions, IDE licences, API fees, cloud hosting | 8810 — Office expenses | Recurring software costs are current expenses. Software you buy outright is different — see CCA below. |
| Internet and phone (business share) | 9220 — Utilities (including telephone) | Claim the business-use percentage only; keep the basis for your split. |
| Accountant, lawyer | 8860 — Professional fees | Includes the cost of getting your return prepared. |
| Conference travel | 9200 — Travel expenses | Meals while travelling belong on 8523 at the 50% rule, not on 9200. |
| Subcontracted developers | Part 3 (subcontracts), not Part 4 | A common misfiling — subcontracts reduce gross income in Part 3, they are not an operating expense. |
| Home office | T2125 Part 7 | Calculated last, can't create a loss. See the Part 7 walkthrough. |
| Errors & omissions insurance | 8690 — Insurance | Business insurance only — not life or health premiums. |
Sorting a year of bank transactions into these lines is exactly what the free expense categorizer and expense tracker do — and the tracker exports a summary ordered by T2125 line for tax software.
Hardware isn't written off as a simple expense — it's capital property you depreciate through CCA in Area A of the T2125. The classes that matter to a developer, from the CRA's classes of depreciable property (verified July 5, 2026):
This is the part developers get wrong most often, in both directions:
Our GST/HST registration calculator works through the threshold test with your own numbers.
Every figure above survives an audit only as well as the records behind it. The free expense tracker logs expenses against the real T2125 lines all year, and the deadline calendar puts every CRA date — including the instalment quarters that surprise second-year freelancers — on your phone.
Fill out my T2125 for me — free →
Generally no — services to non-resident clients are usually zero-rated (0%) under the export provisions, though specific exclusions exist. You still report these sales on your GST/HST return, and they still count toward the $30,000 registration threshold.
Most freelance developers, web developers, and IT consultants fit 541514 (computer systems design and related services) under NAICS 2022. Pick the code that best matches your main activity.
Very likely yes for now: computers are Class 50 property, and the enhanced first-year rules give a 100% first-year deduction for Class 50 property acquired after April 15, 2024 that becomes available for use before 2027. It's a CCA claim in Area A, not an expense line.
Yes. Platform payouts are gross business income on the T2125, and the platform's fees are deductible.
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Estimates and general information only, for planning purposes — this does not constitute tax, legal or accounting advice, and your facts may change the answer. Consult a tax professional about your situation. GST/HST registration and zero-rating rules verified against CRA published sources (GST/HST Memoranda 2-2 and 4-5-3) and CCA classes verified against the CRA's classes of depreciable property page on July 5, 2026; industry code verified against Statistics Canada NAICS 2022 on July 5, 2026. T2125 line names follow the CRA T4002 guide.