Canada is a hot bed of business barter, for a number of reasons. This week YourHome.ca published a story on the best practices of barter, quoting several exchange owners, and giving a great overall description of barter. One thing that stood out in the article, to my Yankee eyes, is, ”
Just because little or no cash trades hands in bartering doesn’t mean that the Canada Revenue Agency isn’t interested. The retail value of the goods or services bartered by an individual must be considered as income.
But Muzzin and Holland both point out that as with cash-based businesses, goods and services offered at retail value by barter members were purchased at wholesale prices, which mean the barterer can end up ahead.”
In the States, all barter transactions are considered taxable events and to that end each barter exchange must report those transactions using a 1099-B form with the IRS. The Canada Revenue Agency does not require this kind of reporting, but instead relies on the individual to report this income. Thus the second statement.
See the full story at http://yourhome.ca/homes/repairsandrenovations/article/756120-the-art-of-the-barter
