How to make more money in Canada: 6 side hustle ideas

Why? In January 2023, 45% of Canadians reported they were $200 away or less from not being able to meet all of their regular financial responsibilities, and 30% said they already didn’t make enough money to pay their bills. A recent Statistics Canada survey found that a quarter of Canadians (26%) didn’t feel prepared enough to cover an unexpected $500 expense. 

How easy is it to start a side hustle? I spoke with three Canadians who have done it. They shared the upsides and downsides of having a second job—along with hard-won advice about being your own boss. Read on to learn more about how to start a side hustle, and how it could help you make more money and deal with the rising cost of living in Canada.

What is passive income, and how do you earn it?  

Lately, there’s been a lot of online chatter about “passive income,” especially among influencers promoting passive income/remote side hustles that promise “big returns.” 

Passive income is money earned with minimal effort, once you’ve already set up a business or an investment—the opposite of active income made from your 9-to-5 job, for example. (It’s often described as “making money in your sleep.”) Think investment income, rental property income or even affiliate revenue from online content you produce (you earn a commission when customers make a purchase from a company you referred them to). 

Sounds great, right? But buying dividend stocks, owning rental properties and making viral videos isn’t exactly within reach for everyone. 

People hunting for other passive-income opportunities may come across influencers promoting e-commerce side hustles. If you look into it, the job description usually involves setting up an online shop on a platform like Amazon or eBay. You would have to purchase products and manage your store—and there’s no guarantee that you’d even make a profit. Also, good advice has always been to beware of outright scams and pyramid schemes that sound too good to be true.

Now that I’ve cleared up passive income, let’s get into how you can actually make more money in Canada. Let’s look at some side hustles and what they involve, including startup costs, hours and more. 

How can you make more money in Canada?

Much like finding any kind of job, your side hustle needs to be a good fit for your abilities and circumstances. Ask yourself these three questions to narrow down your options:  

1. Do you have the time and energy? If you’re already exhausted from your 9-to-5 job and other responsibilities, is adding another job realistic for you? 
2. What skills do you have? Make a list of both your hard and soft skills. For example, can you drive? Are you good with people? Do you have any in-demand technical skills?
3. How much can you afford to spend? Some side hustles require an upfront investment to purchase raw materials, create a website, etc. Decide how much you’re willing to spend even if you don’t end up making money from it. Only spend what you’re willing to lose.

Once you have a clearer idea of your options, consider one of the following ways to make extra money.

1. Driving for delivery or ridesharing services

If you have access to a car, making deliveries or driving for a ridesharing service can be a flexible way to make some money—and it’s accessible if you already own a vehicle. 

Vitor (who requested his last name not be used) an accountant in London, Ont., started driving for Uber last year. He and his family had recently arrived from Brazil. Once he realized their planned budget didn’t match the actual costs of renting and living in Canada, he decided to get a second job. 

“It’s good to have such a flexible option where you can decide if you are going to show up that day, and for how long,” Vitor says. “With this additional income, we’ve been able to balance the budget.” 

How much do Uber drivers make? 

That depends on location and the number of rides they can provide in a day, as well as how many hours they work in a week. 

Here’s how three popular ridesharing and delivery platforms pay their drivers and couriers:

There is no minimum number of rides or hours specified for these ridesharing and delivery apps.

Vitor drives an average of three hours a day, five days a week. He estimates that he makes $20 to $30 an hour including taxes and tips. So, at roughly $25 an hour, he takes home an extra $1,500 each month from driving. Vitor feels the extra money outweighs the costs of gas and car maintenance. Most of his clients are students at Western University and Fanshawe College.

You’ll have to consider your location, however, as it can impact your profits. Advocacy group RideFairTO estimates that full-time Uber drivers in Toronto make less than $8 per hour, once unpaid idle time and car expenses are considered. 

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2. Turn a hobby into a side business 

When Samantha Roberts, 25, moved out of her family member’s home in Toronto and began renting with her partner, she noticed that her everyday spending was quickly adding up. “I find everything to be insanely expensive [here], especially groceries,” Roberts says. 

Roberts was already spending a lot of time on embroidery as a hobby. So, she started her own custom embroidery business. She advertises her products on Instagram, and her clientele includes small local businesses purchasing uniforms for their employees, and people in her community looking for gifts. 

Roberts says balancing her part-time job, her side business and her studies—she’s in school to become a teacher—can get quite busy, but monetizing her hobby was worth it. “Having extra spending money really does take some of the stress away,” she says. 

While Roberts accepts payments from customers directly, if you’re considering starting your own shop, you could sell through an online marketplace like Depop or Etsy—these apps manage the payments and offer a wide customer base, which is especially helpful if you aren’t social-media-savvy or don’t want to spend time on marketing. Keep in mind, though, that these and other platforms charge fees for product listings, transactions, payment processing and advertising—read the terms and conditions carefully, and plan for that when you create your pricing. 

Roberts successfully found a niche, but not every hobby or skill will turn a profit. If you’re going to spend time, energy and possibly money on a side business, ask yourself whether there is a real demand for what you want to do—beyond your family and friends, of course.

Not so crafty? Some other side-business ideas are dog walking, tutoring, reselling clothes or other belongings, teaching fitness classes and more. Look at your day job or past experience. If it’s not a conflict of interest for your current employer, you could start a side business.

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3. Use your skills for freelancing

Aubrey Chapnick, a senior product marketing manager in Toronto, wanted to find a way to use his writing and consulting skills in his free time. In early 2021, when a friend mentioned they worked at a financial media company and needed writers, he jumped on the opportunity. After publishing a few posts, Chapnick started reaching out to his network about potential opportunities and sharing his portfolio. He was then able to land more paid work with other financial publications and startups. 

Chapnick has worked with roughly seven clients this past year. He says that having an additional source of income reduces the impact of inflation and gives him a sense of security.

While Chapnick says the experience he gained from his freelance work also helps him with his day job, others are looking at a backup plan. “Career cushioning” is the term for expanding your skills or starting a side hustle in case you lose your job or want to change careers. It’s become buzzy to do so in recent months amid headlines of layoffs at major companies and a possible recession.

If you have marketable skills like social media management, web development or IT support and your primary employer would be okay with you working on the side, you could start by creating a profile on freelancing sites like Upwork, Contently or Fiverr. Just be wary about working for low pay—if the hourly fee is below minimum wage, you may as well get a minimum-wage job. 

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4. Rent out your car  

If you’re looking for a low-lift side hustle, start with what you already have. If you own a computer, for example, what can you do or create using that tool? If you own a car in good condition, you could rent it out on Turo, a carsharing website that matches you with people who need to rent a car. You charge renters a daily fee, and Turo takes 25% of the trip price. 

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5. Complete paid surveys

You could also look into paid research surveys, but keep in mind that opportunities may be sporadic and the pay is low. The estimated pay from Survey Junkie is around $40 a month if you complete three surveys daily. You might also have to sign up for multiple survey sites to make a substantial amount of money. 

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6. Can you make money on social media?

If you have found a niche on social media and are able to amass a substantial following, you might be able to transition your account to a business account and make money on ad revenue. Keep in mind that this requires consistency and a targeted approach. You could also add to your existing customer base by actively posting engaging content on Instagram, if you work in real estate or in the service industry, for example.

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When does a side hustle become a full-on business, and what should you do then? 

The point of a side hustle is to turn a profit, and that’s enough for the Canada Revenue Agency (CRA) to view your activities as a business. Scott Sather, Certified Financial Planner at Awaken Wealth Management, says that you should record the income you earn from a side hustle so you’re prepared for tax season. If you run a side business, you’ll be “taxed at your marginal tax rate on top of any other income you earn.”

Marginal tax rate is the percentage of your income that is taxable, based on your total income and which tax bracket your earnings fall into. And if you earn more than $3,500 in one year from your self-employment, you’ll also have to set aside some of your income for Canada Pension Plan (CPP) or Québec Pension Plan (QPP) contributions. 

Another perk—in addition to extra cash: Having a side hustle means you can claim business expenses. These are reasonable costs you incur to start and run your business. 

“If you want to claim the expenses against your income, you will need to track expenses and save receipts,” says Sather. A credit card bill is not enough—you need receipts or agreements of purchases and sales from vendors.

Sather also says that if you expect to make more than $30,000 per year from your side hustle, you will have to set up a GST/HST number to begin collecting goods and services tax (GST) and/or harmonized sales tax (HST), depending on where your customers are based (Canadian customers pay tax according to the province in which they reside). 

The amount of tax you’ll charge depends on the “place of supply”—where you make the sale. The current GST/HST rates are:

You’ll need to file GST/HST returns, but the upside is that you get to claim the sales tax you pay for your business expenses to offset the amount you collect. (Learn more about side-hustle taxes.)

Things you need to know about having a side hustle

“Make sure you’re being realistic with your expectations about the income you can generate,” Sather says. Before you launch your side hustle, work out the projections. Have a “conservative” estimate of your revenue and the total of your expenses from the side hustle. Then calculate the difference to see how much you’ll take home and whether the added income is worth it. You can also consider things like lost rest/sleep, family time and leisure time as costs, Sather says.

Think carefully about taking on another job, especially if you are already time-strapped. If you decide to get a side hustle, however, you might end up with some new skills and a bit more money in your pocket. 

Read more about budgeting:

• The cost of the average grocery bill in Canada–and how to lower yours
• Earning, saving and spending money in Canada: A guide for new immigrants
• The 6 best bank accounts for side hustles in Canada
• How to make money selling stuff online
• The one inflation tool you need for your finances
• Not sure what to put in your RRSP and TFSA? Make contributions anyway

About Margaret Montgomery

Margaret Montgomery is a former MoneySense editorial assistant and MoneyFlex columnist. She studied business administration at Wilfrid Laurier University and journalism at Centennial College.

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