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Digital platform reporting in Canada: what Part XX asks of a marketplace

A marketplace with Canadian sellers must tell the CRA what each one earned, by 31 January, and give the seller a copy. Who is the operator, what to collect, the CAD 2,800 exclusion for small sellers of goods, and what a late return costs.

Kreezalid9 min read

In short: under Part XX of the Income Tax Act, a marketplace operator that is resident in Canada, or that is established outside Canada and its partner jurisdictions but has sellers resident in Canada, must identify its sellers, file an information return with the Canada Revenue Agency by 31 January of the following year, and give each reportable seller their own figures by the same date. Small sellers of goods are left out: fewer than 30 sales and no more than CAD 2,800 in the year. A late return costs between $100 and $7,500.

This guide is for people who run or plan a marketplace. It follows the CRA’s Reporting rules for digital platform operators page and its guidance document, read on 12 November 2026. Paragraph numbers below refer to that guidance. It is information, not tax advice: check your own case with an accountant.

Where the rules come from

Part XX is Canada’s version of the OECD model rules for platforms, the same model the United Kingdom follows. The bill received Royal Assent on 22 June 2023 and the rules sit in sections 282 to 295 of the Income Tax Act. They came into force on 1 January 2024, so the first return, on 2024, was due on 31 January 2025. The return on 2026 is due on 31 January 2027.

Am I concerned?

Is your website a platform?

A platform connects sellers with customers for one of four “relevant activities”: selling goods, renting real or immovable property, providing a personal service, or renting a means of transport, each for consideration. The CRA defines a personal service as “time- or task-based work performed by one or more individuals at the request of a user”.

Software is not a platform if it exclusively processes payments, lists or advertises, or redirects users to a platform. In the guidance’s words (paragraph 2.6), “pure payment processors, classified ads boards and online aggregators do not meet the definition”.

Are you a reporting platform operator?

Paragraph 2.24 gives three cases. A platform operator that is not excluded is a reporting platform operator if:

  • it is resident in Canada; or
  • it is resident, incorporated or managed in a partner jurisdiction and elects to report in Canada; or
  • it is not resident in Canada or a partner jurisdiction, and “it facilitates the provision of relevant activities by sellers resident in Canada”.

Partner jurisdictions are countries with similar rules that Canada exchanges the information with. The CRA keeps the list on a separate page, which we did not read: check it before concluding that your country is one.

In practice:

  • A Canadian marketplace reports its sellers resident in Canada and in partner jurisdictions.
  • A marketplace in a partner jurisdiction normally reports under its own country’s rules, and the two tax authorities may exchange the information. It can choose to report to Canada.
  • A marketplace anywhere else with sellers resident in Canada, or sellers renting out property in Canada, reports to the CRA on those sellers only.

An operator can be excluded if its entire business model lets no seller make a profit, or has no reportable seller. It must be able to demonstrate this, review it every year and keep the documents.

What if my marketplace runs on someone else’s software?

The guidance defines the operator by the contract, not by the technology (paragraph 2.15):

“A platform operator is an entity that contracts with sellers to make available all or part of a platform to such sellers.”

On that definition, the operator is the company whose terms the sellers accept, and a software vendor that has no contract with them is not. The guidance says something close when it deals with the providers an operator hires for its seller checks (paragraph 5.18):

“The mere provision of service by a third party does not make it a platform operator”

The same paragraph adds that the requirements “remain the responsibility” of the reporting platform operator. This is the reading the text supports. It is not a ruling on your contracts: if the vendor, or a payment provider, also signs with your sellers, have the arrangement reviewed.

Which sellers are reported?

A reportable seller is an active seller, not excluded, resident in Canada or a partner jurisdiction. Four kinds of seller are excluded (paragraph 3.7):

  • an entity with more than 2,000 property rentals for a listing in the period;
  • a governmental entity;
  • an entity whose stock, or a related entity’s, is regularly traded on an established securities market;
  • a small seller of goods, where the operator facilitated “less than 30 relevant activities for the sale of goods” and the total paid or credited “did not exceed CDN $2,800 during the reportable period”.

Both conditions apply to the last one, and it covers goods only. A driver, a freelancer or a host has no minimum.

The calendar of a reporting year

The reportable period is the calendar year. For 2026:

When What
Through 2026 Collect and verify seller information
31 December 2026 Due diligence complete for the sellers active in the year
31 January 2027 File the Part XX information return, and give each reportable seller their information
Six years Keep the records, in an electronically readable format

Sellers who were already on the platform when the rules started, or when a company becomes a reporting platform operator, get more time: their due diligence must be finished by 31 December of the operator’s second reportable period (paragraph 5.4).

The return is filed electronically, “in prescribed form using an XML Schema”. An operator must get an RZ number before its first filing. A resident operator files through My Business Account. A non-resident first gets a Web Access Code. The guidance does not say what happens when 31 January falls on a weekend, as it does in 2027: do not count on an extra day.

What to collect from sellers

Paragraph 6.9 lists the identification information to report for each seller, which is what you need to collect:

  • the name: first and last name of an individual, legal name of an entity;
  • the primary address;
  • the jurisdiction or jurisdictions of residence for tax purposes;
  • the tax identification number (TIN) and the jurisdiction that issued it;
  • the date of birth, for an individual;
  • the business registration number, for an entity;
  • the financial account identifier, where the operator has it, and the account holder’s name if it differs from the seller’s.

For rented property, add the address of each listing.

The operator must take steps “to verify the reliability” of this information (paragraph 5.1). The guidance mentions, as examples of enforcement, “a mechanism to no longer allow undocumented sellers to access the platform or to not pay out the consideration to such sellers”. Asking at sign-up is simpler than either: build the questions into your seller onboarding. Your payment provider checks identities for its own purposes, but the Part XX duties stay with the operator.

What goes in the return

For each reportable seller, besides the identification above (paragraph 6.11):

  • the total consideration paid or credited, by calendar quarter, and the number of relevant activities;
  • the fees or commissions charged by the operator, by quarter;
  • the taxes withheld or charged by the operator, by quarter;
  • for property rentals, the address of each listing and, if available, the land registration number, the number of days rented and the type of listing.

Amounts are reported in the currency in which they were paid. A seller paid in Canadian and US dollars has each reported separately.

What the seller receives

Paragraph 6.2:

“The reporting platform operator must also provide each reportable seller with the information specific to them that is included in the Part XX information return.”

The deadline is the same 31 January. The passages we read set no format.

A page to point your sellers to

The CRA’s Reporting rules for digital platform operators page explains who is affected, sellers included: people who sell goods, rent out property, drive or deliver, or provide personal services. Sellers should also know that the request for a TIN is backed by a penalty on them, below.

Penalties

Late return. An operator that fails to file when required “is liable to a late-filing penalty under subsection 162(7.01) of the Income Tax Act” (paragraph 6.29). That subsection sets the penalty at the greater of $100 and a daily amount, counted for at most 100 days:

Number of information returns Per day Maximum
Fewer than 51 $10 $1,000
51 to 500 $15 $1,500
501 to 2,500 $25 $2,500
2,501 to 10,000 $50 $5,000
More than 10,000 $75 $7,500

The guidance does not say how returns are counted for a Part XX filing, and we could not confirm it.

Seller who withholds a TIN. Paragraph 8.7: a reportable seller who fails to give their TIN on request “is liable to a penalty of $500 for each such failure”, unless they apply for one within 90 days and pass it on within 15 days of receiving it, or cannot obtain one. The operator “should document their efforts to obtain the TIN”.

The guidance passages we read name no specific penalty for a missing seller copy or for due diligence failures. That does not mean none exists in the Act: ask your accountant.

Frequently asked questions

Who has to file a Part XX information return?

A reporting platform operator with reportable sellers: an operator resident in Canada, an operator in a partner jurisdiction that elects to report in Canada, or an operator outside both that has sellers resident in Canada. The return is due by 31 January after the calendar year.

Does a foreign marketplace report to the CRA?

It depends on where it is established. An operator outside Canada and outside the partner jurisdictions must report its sellers resident in Canada and its sellers renting property in Canada. An operator in a partner jurisdiction normally reports in its own country.

Is there a minimum before a seller is reported?

For goods only: a seller with fewer than 30 sales and no more than CAD 2,800 in the year is excluded. Both conditions must be met. Services and rentals have no minimum.

Is the software company behind my marketplace a platform operator?

The CRA defines the operator as the entity “that contracts with sellers”. On that definition, a vendor that only supplies the software and has no contract with your sellers is not the operator: your company is.

What does a seller receive?

By 31 January, the information about them that the operator put in its return: identification details, amounts by quarter, number of sales or services, fees and taxes.

The same question in other countries

Because services and rentals have no minimum, the rules weigh most on rental marketplaces and peer-to-peer marketplaces, where many sellers are individuals.

What Kreezalid prepares for you

On the Grow and Extend plans, your back office has a page called Seller statements, under Sales. It adds up what each seller was paid over a calendar year, quarter by quarter: number of sales, net amount paid, and the fees and commissions you withheld. Each currency has its own table, and nothing is converted.

  • For you: the list of every seller paid in the year, with a CSV export to check, or to hand to your accountant.
  • For each seller: their own statement in their seller space, ready to print or save as a PDF.
  • A hint, not a ruling: sellers under 30 sales of goods and €2,000 are flagged, from your marketplace’s figures alone.

The quarterly layout follows the OECD model rules that Part XX is built on. The statement is not a CRA form: use it as the working figures behind your Part XX return and the copy you owe each seller.

What it does not do yet: it does not e-mail the statements, it does not collect tax identification numbers or tax residence from your sellers, and it does not produce the file for the tax authority. Those are the next steps on our roadmap. You remain the operator: Kreezalid computes the figures and files nothing on your behalf.

See what each plan includes on the pricing page.

Sources

All read on 12 November 2026.