Can eTransfers be traced? Absolutely and more often than people think. What used to feel like a casual way to split a bill or pay for a service is now under much closer scrutiny. With the Canada Revenue Agency (CRA) increasing audits in 2025, especially targeting gig workers and side hustlers, eTransfers are no longer flying under the radar.
If you’ve ever wondered whether those Interac eTransfers sitting quietly in your bank history could come back to haunt you during tax season, you’re not alone. The rules are shifting, and if you’re accepting money for services even if it’s just “under the table” you might already be on the CRA’s radar.
Let’s break this down, bust some myths, and show you how to stay compliant while still making your money moves.
TL;DR: What You’ll Learn Here
- Are eTransfers traceable by the CRA?
- Why audits are increasing across Canada
- When a transfer becomes “taxable income”
- What the CRA looks at during an audit
- How to protect yourself (and your bank account)
- One simple step to avoid unexpected tax bills
Can eTransfers Be Traced? Yep Here’s How
Yes, eTransfers can be traced, and not just by your bank. Any eTransfer you send or receive leaves a digital footprint. That includes:
- The name of the sender and recipient
- The email or phone number used
- The amount sent
- The date and time
- Any message or note attached
Banks are required by law to keep this information for several years, and if the CRA asks for it, the bank has to comply. This usually happens during an audit or if you’re part of a larger investigation. So, even if you think those transfers are just between you and a client, they’re anything but invisible.
Why Is the CRA So Interested in eTransfers Now?
Over the last few years, the CRA has sharpened its focus on the informal economy the money people make outside traditional jobs. This includes side gigs, freelancing, cash work, and digital hustles. As more people accept payments by eTransfer instead of cash, the CRA has realized that these once-hidden transactions are now easily traceable.
And the result? A rising number of eTransfer audits.
In fact, CRA officials have openly stated that they are targeting industries where underreported income is common, such as construction, beauty services, digital creators, and short-term rentals (Source: Financial Post).
They’re also analyzing transaction patterns using algorithms. That means if your income doesn’t match your bank activity, you might get flagged even if you thought you were too small to notice.
When Does an eTransfer Count as Income?
Not every eTransfer is taxable. If your roommate sends you their share of the internet bill or your mom sends you birthday money, the CRA won’t care. But when you start receiving money regularly for something that looks like work, that’s a different story.
Here’s the rough guideline: If you’re offering a service or selling something and getting paid for it even casually it’s considered income. That includes:
- Doing haircuts for friends and getting paid
- Selling products through Instagram or Facebook Marketplace
- Tutoring, babysitting, dog walking, or house cleaning
- Getting freelance work through referrals instead of platforms
If those eTransfers aren’t showing up on your tax return, the CRA may view that as unreported income and that could trigger a reassessment, interest, or even penalties.
What Happens During an eTransfer Audit?
When the CRA audits someone, they don’t just look at your tax return. They also request your banking information, including your eTransfer history. You might be asked to explain every large or repeated deposit that doesn’t clearly come from an employer.
Here’s what they’ll typically look for:
- Frequency of eTransfers from different sources
- Payment notes that indicate a service (like “invoice,” “haircut,” or “rent”)
- Deposits that don’t line up with declared income
- Transfers from people outside your close circle
They can go back several years and may include all your accounts. If they decide those eTransfers are undeclared income, you’ll owe taxes and potentially interest and fines on top of that.
Can the CRA Just Take My Bank Info?
Not right away, but they can access it. Here’s how:
The CRA can issue something called a Requirement for Information (RFI) to your financial institution. That’s a legal document that compels the bank to hand over your records. Banks don’t fight this they comply, and the CRA gets full visibility into your account activity.
This usually happens during:
- Targeted audits
- Lifestyle assessments (when your spending doesn’t match your income)
- Industry-wide sweeps (common in trades, hospitality, or online sales)
In short: if you’re on their radar, they can absolutely access your eTransfer records.
The One Mistake Side Hustlers Keep Making
A lot of people think small amounts or “casual jobs” don’t count as income. But the CRA doesn’t care how small the job is if you’re paid, you’re expected to report it. Many side hustlers figure they’re flying under the radar because it’s only a few hundred bucks a month. But those small transfers add up, and the CRA is catching on.
What’s worse? Mixing business and personal transactions in the same bank account. That makes it harder to track what’s what, and harder to defend yourself if you’re audited.
What Can You Do to Stay Compliant?
This is where it’s easier to stay ahead than to clean up a mess later. If you’re accepting eTransfers for work, take these steps to protect yourself:
- Open a separate account for business or side income
- Keep track of who sent what, and why
- Declare all income even small amounts on your taxes
- Save screenshots or notes for each payment, just in case
- Update your bookkeeping monthly so nothing gets missed
Staying organized won’t just save you from penalties. It can also help you claim legitimate expenses and reduce how much tax you owe.
What If You Made a Mistake?
If you think you’ve already missed reporting income from eTransfers, there’s still time to fix it. The CRA has something called the Voluntary Disclosures Program, which lets you correct past tax filings without automatic penalties. But the key is to do it before they contact you first.
Trying to hide income or delay fixing the problem just makes it worse. The CRA’s systems are getting smarter, and they can cross-reference income from eTransfers, PayPal, Venmo (in some cases), and even cryptocurrency exchanges.
Can Personal Transfers Still Trigger an Audit?
In rare cases, yes but only when the amounts or frequency don’t make sense. If you’re consistently receiving large transfers from non-family members and you don’t have an explanation, the CRA may dig deeper.
If it’s really a personal gift or loan, keep a written note or message as a record. But if you’re accepting money for a favor that’s really just unpaid work, it’s safer to treat it like income and declare it.
Key Takeaways
- Yes, eTransfers can be traced, your bank stores them, and the CRA can request access during an audit.
- The CRA is increasing audits across Canada, especially for gig workers and side hustles paid through eTransfer.
- If you’re getting paid for services or selling products, it’s likely taxable income even if it feels casual.
- Use separate accounts, track everything, and report all income on your tax return to avoid surprises.
- If you think you’ve made a mistake, take action before the CRA comes to you. It’s easier (and cheaper) to fix than to fight.
Not sure if your eTransfers might raise red flags? Or need help getting your income and tax records in order before an audit? Contact Us for support, tools, or a full compliance review tailored to your situation.