Selling on Amazon, Etsy, or Shopify means managing platform fees, shipping costs, and inventory across provinces. ScanForTax categorizes every expense to the right T2125 line automatically.
Real scenarios where ScanForTax saves you time and money at tax time.
Your $39.99/month Amazon Professional account fee plus $250 in referral fees. ScanForTax splits these into the correct T2125 categories — office expenses and management fees.
A $300 order of mailer boxes, bubble wrap, and shipping labels. These are consumable supplies deductible on Line 8811.
A $200 lightbox, backdrop, and phone tripod for product photos. Under $500, fully expensed as supplies rather than CCA.
The T2125 line items most relevant to your work — ScanForTax maps these automatically from every receipt you scan.
| Line # | Category |
|---|---|
| 8871 | Management & Admin Fees |
| 8811 | Office Stationery & Supplies |
| 9270 | Other Expenses (Shipping) |
| 8320 | Cost of Goods Sold |
| 8520 | Advertising & Promotion |
Amazon referral fees, Etsy transaction fees, Shopify subscriptions, and payment processing charges are all deductible business expenses under management and admin fees. These often represent 15–30% of gross revenue.
If you sell physical products, you must track opening and closing inventory. Your cost of goods sold is: opening inventory + purchases − closing inventory. Unsold inventory at year-end is not deductible until sold.
T2125 Part 3 — Cost of Goods SoldIf you ship to customers in multiple provinces, you may need to collect and remit the appropriate GST/HST/PST based on the delivery destination — rates vary between Ontario, British Columbia, Quebec, and others. Marketplace platforms like Amazon handle this automatically for marketplace sales.
See how ScanForTax processes a typical e-commerce seller purchase.
Uline Canada
2025-03-15
Ontario
All items are packaging supplies consumed in the shipping process — deductible on Line 8811. The $21.51 HST is fully recoverable via ITC. ScanForTax distinguishes between inventory (products for resale) and supplies (packaging materials) — an important distinction for cost of goods sold calculations.
Don't miss these steps before filing your T2125.
Count and value closing inventory as of December 31
Unsold products must be valued at cost or market, whichever is lower. This is required for your COGS calculation.
Export annual fee summaries from each platform
Amazon, Etsy, Shopify, and PayPal all provide annual tax summaries. Download them for your records.
Compile all shipping and postage costs
Canada Post, UPS, and FedEx charges are deductible. Include FBA inbound shipping if applicable.
Total up packaging and supply purchases
Boxes, tape, labels, and packing materials are supplies on Line 8811.
Review GST/HST collected and remitted across provinces
Verify that the correct tax was charged per delivery destination. Marketplace platforms handle this for sales through their platform.
Calculate home office deduction if you fulfill from home
If you store inventory and ship from home, the workspace and storage area are deductible.
ScanForTax handles most of this automatically
Scan receipts year-round and your categories, taxes, and ITC totals are ready when you need them — no year-end scramble.
See province-specific tax rates and recovery rules for e-commerce seller expenses.
Start scanning now — your first 15 scans are free, no credit card required.
$250,000+ in receipts already processed by Canadian businesses
