Freelancing means working for yourself instead of an employer, or contracting with a company rather than being a full time employee. Canadian freelancers may be compensated and taxed differently than traditional employees.
As a freelancer, you may have multiple clients for whom you work either on a regular or one-off basis. You’re an independent worker who gets paid per job, task or project.
What does freelance work involve?
Freelancing is a type of self-employment in Canada. Some people may freelance as a side hustle in addition to a full-time job. Others may freelance full time for different clients.
As a freelancer, you’re not an employee, so you won’t get a fixed salary or the benefits and pension that a company may provide to its employed staff. However, you may have more freedom and flexibility in determining your work hours and the type of work you want to take on.
Freelancers must shoulder the many responsibilities of running a small business. This includes having to regularly find new or additional clients, marketing your skills and services, negotiating freelance rates with clients, keeping track of billing hours, invoicing clients and paying your own income taxes.
Common types of freelance gigs
- Writing and content creation / blogger.
- Event planning.
- Web design.
- Web developer.
- Social media management.
- Graphic design.
- Digital marketing.
How to find freelance work in Canada
Being a freelancer means you have to find clients and gigs on your own. In the beginning, this can be tough, especially if you’re still building your network and relevant experience. However, the more work you do, the easier it can get. Here are a few ideas for finding work as a freelancer.
LinkedIn can be a handy place to post your resumé and keywords specific to your field and niche. This can help you get the attention of brands or companies looking for people with expertise in your field.
An advantage of using LinkedIn is that not only can you search for freelance jobs, but those looking to hire a contractor can also search for and potentially find you.
Try out freelance or gig websites
There are several websites in Canada — such as Guru, Fiverr, FlexJobs, Freelancer.ca, Indeed, Peopleperhour, Upwork and Workmarket — that allow you to advertise your services and/or search for jobs related to specific fields or areas of expertise.
Keep in mind that some of these websites may always offer the best-paying jobs or rates (although you can occasionally find some good ones). However, if you’re a beginner freelancer, these sites could be a handy way to start building your profile and find clients..
Sometimes, it might be easy to approach a business or individual you would like as a client and offer your services. Do some sleuthing on social media or LinkedIn to find the best person to get in touch with and send them an email discussing what you can offer.
Spread the word
As you get established in your niche, gain more clients and meet other freelancers in the same field, you can create a job network for yourself. When you’re looking for work, let these people know that you are open and available to new clients.
How do freelancers get paid?
Freelancers typically set their own rates, although these can vary based on client budgets. The rate could be per project/task, per hour or set in another type of measure, such as per word for freelance writers.
Once the project is complete, you’ll likely invoice the client to receive payment. Payment methods can include direct deposit into your bank account, cheque or via an online platform like PayPal. Some of these options may have fees that you might ask your client to cover, so do your research before discussing with your client.
Do freelancers have to pay taxes?
Yes. Freelancers, like employees, have to pay taxes in Canada, such as federal and provincial income taxes, as well as make contributions to the Canada Pension Plan (CPP).
Unlike traditional employees, freelancers can deduct eligible business expenses from their income, reducing their total amount of taxable income and the amount of federal taxes. If you’re going to do freelance work, be sure to track your income and expenses and save your receipts.
Since you work for yourself, it’s your responsibility to set aside money for your taxes and pay them before the deadline. You’ll need to estimate which income tax bracket you’ll fall under and the applicable tax rates so that you save a percentage of your earnings on a monthly or other schedule, or each time you receive payment.
Note that if you expect to owe the Canada Revenue Agency more than $3,000 in annual income taxes, you’ll have to pay in quarterly installments rather than once a year.