Recruiter

Tax guide for Canadian self-employed recruiters and talent acquisition consultants

Allowable Expenses

• LinkedIn Recruiter & ATS subscriptions — LinkedIn Recruiter, Bullhorn, JobAdder, or other applicant tracking system fees
• Job board posting fees — Indeed, Monster, Workopolis, or niche job board posting costs for client roles
• Home office — Proportional share of rent, utilities, internet, and home insurance
• Professional memberships — NAPS, Association of Canadian Search Employment and Staffing Professionals fees
• Client entertainment — 50% of business meals and networking events with candidates or client hiring managers
• Professional liability insurance — Errors and omissions (E&O) insurance premiums required for recruiting engagements

Tax Tips

• Placement fees received on successful hires are business income reported on T2125
• LinkedIn Recruiter and ATS subscription costs are fully deductible business expenses
• If you place contractors earning over C$30,000, you may need to register for GST/HST
• Client entertainment is deductible at 50% — keep receipts noting the business purpose

Frequently Asked Questions

Do I need to charge GST/HST on recruiting fees in Canada?

Yes — most recruiting and staffing placement services in Canada are taxable for GST/HST purposes. You must register for a GST/HST account once your annual revenue from recruiting exceeds C$30,000.

How do I calculate and report my placement fee income on the T1?

Report all placement and retainer fees received during the calendar year as business income on Form T2125 (Statement of Business Activities). This includes contingency fees, retained search fees, and any milestone payments.

Can I deduct LinkedIn Recruiter as a business expense?

Yes — LinkedIn Recruiter, LinkedIn Sales Navigator, and similar subscription tools are fully deductible business expenses when used exclusively for your recruiting business. Report them on T2125 under Office Expenses or Other Expenses.