I called the CRA many times regarding my question but I wasn't able to get an answer and they kept redirecting me to different people and departments.
I am now a PR in Canada, Before coming to this country I worked for 3 years with a friend on some free mobile apps (all free games), of course we weren't tracking any expenses or purchased software since there is no income tax there. the apps didn't generate a lot of money for a very long time but we kept working, now after coming to Canada the apps started making more money and I am working on new apps.
I will pay taxes on the new apps, but what about the old stuff ? I really don't see it fair to pay taxes for those especially I won't be able to claim any expenses, but I don't want to get in trouble of course. few things to note:
- I am not taking any interest on any money in the bank.
- the revenue from the old apps exceeded 30,000 CAD
- everything is free and the whole revenue is from Ads in the apps, I never collected GST/PST from anyone, I am using the Business form (T2125) to report this income since I registered a business name, should I enter my income in the "Gross Sales, commissions or fees" field ? is there a special case where you are providing everything for free ?