Perhaps the most common misconceptions about taxes and your online business is that the two are not related to each other. Most people think that online businesses are not really taxed that’s why more and more people are becoming attracted to start their very own online business.
If you are one of the many people who is interested in starting your own online business or if you already have an online business of your own, then for sure you have heard about the controversies about online businesses and taxes.
Most people who don’t really have a stable background about online businesses and taxes would most probably guess that owners of online businesses are able to be exempted from paying taxes.
However, in reality, online businesses are still covered with tax dues.
“But I Am Working At Home”
And Other Lame Excuses Not To Pay Taxes
The most common excuse of people who have online businesses who wish to ditch paying taxes is that they are “working at home”. What most people don’t realize is that taxes are actually based on the sources and amount of the income as well as the types of services and products sold; not on the location of the business.
So whether you are working at home, in a store or in a warehouse, you are still obliged to pay for whatever tax is due to you.
Internet Tax Is Just Like Any Business Tax Basically, online businesses are taxed just like any other business. The government does not actually collect income taxes based on how a business operates but instead, it focuses on the form of the business.
A business based on the Internet still has to register for GST and PST (if applicable) just like any other business. Whether your online business is a sole proprietorship or incorporated, you will still need to fill up some important forms so that your online business can be deemed as legal and so that you can pay the proper taxes regularly.