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@@ -80,7 +80,7 @@ invoice alone is not sufficient to confirm self-employment status. Proper assess
sto ensure accurate classification and compliance with tax and labor regulations. sto ensure accurate classification and compliance with tax and labor regulations.
Factors Determining the Type of Contract Factors Determining the Type of Contract
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ -----------------------------------------
The CRA uses a two-step approach to examine the relationship between the worker and the The CRA uses a two-step approach to examine the relationship between the worker and the
payer for relationships outside the province of Québec. The approach used for relationships payer for relationships outside the province of Québec. The approach used for relationships
@@ -110,7 +110,7 @@ that relate to the following factors:
- the degree of responsibility for investment and management held by the worker - the degree of responsibility for investment and management held by the worker
- the worker's opportunity for profit - the worker's opportunity for profit
- any other relevant factors, such as written contracts - any other relevant factors, such as written contracts
The CRA will look at the answers independently and then together and consider whether or The CRA will look at the answers independently and then together and consider whether or
@@ -121,7 +121,8 @@ answers are more consistent with a contract of service or a contract for service
Each of these factors will be discussed in the material and indicators showing whether the Each of these factors will be discussed in the material and indicators showing whether the
worker is an employee or self-employed will be provided. worker is an employee or self-employed will be provided.
**Control** Control
~~~~~~~
One of the key factors in determining a worker's status is the extent to which the payer has the ability, authority, or One of the key factors in determining a worker's status is the extent to which the payer has the ability, authority, or
right to control both what work is performed and how it is carried out. Equally important is the level of independence the right to control both what work is performed and how it is carried out. Equally important is the level of independence the
@@ -146,7 +147,8 @@ Worker is a *Self-Employed* when:
- The worker can accept or refuse work from the payer. - The worker can accept or refuse work from the payer.
- The working relationship between the payer and the worker does not present a degree of continuity, loyalty, security, subordination, or integration. - The working relationship between the payer and the worker does not present a degree of continuity, loyalty, security, subordination, or integration.
**Tools and Equipment** Tools and Equipment
~~~~~~~~~~~~~~~~~~~~
Ownership of tools and equipment is not a definitive factor in determining the nature of a working relationship or the type Ownership of tools and equipment is not a definitive factor in determining the nature of a working relationship or the type
of contract in place. While self-employed individuals often use their own tools to fulfill contractual obligations—making of contract in place. While self-employed individuals often use their own tools to fulfill contractual obligations—making
@@ -176,7 +178,8 @@ The worker is a self-employed individual when:
- The worker provides the tools and equipment required and is responsible for the cost of repairs, insurance and maintenance and retains the right over the use of these assets. - The worker provides the tools and equipment required and is responsible for the cost of repairs, insurance and maintenance and retains the right over the use of these assets.
- The worker supplies his or her own workspace, is responsible for the costs to maintain it, and does substantial work from that site. - The worker supplies his or her own workspace, is responsible for the costs to maintain it, and does substantial work from that site.
**Subcontracting Work or Hiring Assistants** Subcontracting Work or Hiring Assistants
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
As subcontracting work or hiring assistants can affect a worker's chance of profit or risk of loss, this can help determine As subcontracting work or hiring assistants can affect a worker's chance of profit or risk of loss, this can help determine
the type of business relationship. the type of business relationship.
@@ -191,7 +194,8 @@ The worker is a self-employed individual when:
- The worker does not have to perform the service personally. - The worker does not have to perform the service personally.
- They can hire another party to complete the work, without consulting with the payer. - They can hire another party to complete the work, without consulting with the payer.
**Financial Risk** Financial Risk
~~~~~~~~~~~~~~~~~~
When evaluating the nature of a working relationship, the Canada Revenue Agency (CRA) considers whether the individual When evaluating the nature of a working relationship, the Canada Revenue Agency (CRA) considers whether the individual
incurs fixed, ongoing costs or unreimbursed expenses. In traditional employee arrangements, employers typically reimburse incurs fixed, ongoing costs or unreimbursed expenses. In traditional employee arrangements, employers typically reimburse
@@ -216,7 +220,8 @@ The worker is a self-employed individual when:
- The worker hires helpers to assist and pays them. - The worker hires helpers to assist and pays them.
- The worker advertises the services offered. - The worker advertises the services offered.
**Responsibility for Investment and Management** Responsibility for Investment and Management
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
When assessing whether a business relationship exists, one important indicator is the worker's financial investment in the When assessing whether a business relationship exists, one important indicator is the worker's financial investment in the
services they provide. If an individual is required to invest in equipment, materials, or other resources to complete the services they provide. If an individual is required to invest in equipment, materials, or other resources to complete the
@@ -236,7 +241,8 @@ The worker is a self-employed individual when:
- The worker has capital investment, manages his or her staff, hires and pays individuals to help perform the work, and has established a business presence. - The worker has capital investment, manages his or her staff, hires and pays individuals to help perform the work, and has established a business presence.
**Opportunity for Profit** Opportunity for Profit
~~~~~~~~~~~~~~~~~~~~~~~~~
A business relationship is often indicated when a worker has the ability to realize a profit or incur a loss, reflecting their A business relationship is often indicated when a worker has the ability to realize a profit or incur a loss, reflecting their
control over the financial and operational aspects of the services they provide. Self-employed individuals typically control over the financial and operational aspects of the services they provide. Self-employed individuals typically

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@@ -106,8 +106,9 @@ present. They typically submit invoices and receive payment through accounts pay
invoice alone is not sufficient to confirm self-employment status. Proper assessment of the working relationship is essential invoice alone is not sufficient to confirm self-employment status. Proper assessment of the working relationship is essential
sto ensure accurate classification and compliance with tax and labor regulations.</p> sto ensure accurate classification and compliance with tax and labor regulations.</p>
</section> </section>
</section>
<section id="factors-determining-the-type-of-contract"> <section id="factors-determining-the-type-of-contract">
<h3><span class="section-number">4.1.3. </span>Factors Determining the Type of Contract<a class="headerlink" href="#factors-determining-the-type-of-contract" title="Link to this heading"></a></h3> <h2><span class="section-number">4.2. </span>Factors Determining the Type of Contract<a class="headerlink" href="#factors-determining-the-type-of-contract" title="Link to this heading"></a></h2>
<p>The CRA uses a two-step approach to examine the relationship between the worker and the <p>The CRA uses a two-step approach to examine the relationship between the worker and the
payer for relationships outside the province of Québec. The approach used for relationships payer for relationships outside the province of Québec. The approach used for relationships
in the province of Québec will be discussed in a later chapter.</p> in the province of Québec will be discussed in a later chapter.</p>
@@ -140,7 +141,8 @@ conclusions may be drawn. When there is no common intent, the CRA will decide if
answers are more consistent with a contract of service or a contract for service. answers are more consistent with a contract of service or a contract for service.
Each of these factors will be discussed in the material and indicators showing whether the Each of these factors will be discussed in the material and indicators showing whether the
worker is an employee or self-employed will be provided.</p> worker is an employee or self-employed will be provided.</p>
<p><strong>Control</strong></p> <section id="control">
<h3><span class="section-number">4.2.1. </span>Control<a class="headerlink" href="#control" title="Link to this heading"></a></h3>
<p>One of the key factors in determining a worker’s status is the extent to which the payer has the ability, authority, or <p>One of the key factors in determining a worker’s status is the extent to which the payer has the ability, authority, or
right to control both what work is performed and how it is carried out. Equally important is the level of independence the right to control both what work is performed and how it is carried out. Equally important is the level of independence the
worker maintains in performing their duties.</p> worker maintains in performing their duties.</p>
@@ -166,7 +168,9 @@ used—that holds the most weight in determining the nature of the working relat
<li><p>The working relationship between the payer and the worker does not present a degree of continuity, loyalty, security, subordination, or integration.</p></li> <li><p>The working relationship between the payer and the worker does not present a degree of continuity, loyalty, security, subordination, or integration.</p></li>
</ul> </ul>
</div></blockquote> </div></blockquote>
<p><strong>Tools and Equipment</strong></p> </section>
<section id="tools-and-equipment">
<h3><span class="section-number">4.2.2. </span>Tools and Equipment<a class="headerlink" href="#tools-and-equipment" title="Link to this heading"></a></h3>
<p>Ownership of tools and equipment is not a definitive factor in determining the nature of a working relationship or the type <p>Ownership of tools and equipment is not a definitive factor in determining the nature of a working relationship or the type
of contract in place. While self-employed individuals often use their own tools to fulfill contractual obligations—making of contract in place. While self-employed individuals often use their own tools to fulfill contractual obligations—making
such ownership common in business relationships—this alone does not confirm self-employment. Employees may also be required such ownership common in business relationships—this alone does not confirm self-employment. Employees may also be required
@@ -195,7 +199,9 @@ replacement, and insurance, rather than mere ownership itself.</p>
<li><p>The worker supplies his or her own workspace, is responsible for the costs to maintain it, and does substantial work from that site.</p></li> <li><p>The worker supplies his or her own workspace, is responsible for the costs to maintain it, and does substantial work from that site.</p></li>
</ul> </ul>
</div></blockquote> </div></blockquote>
<p><strong>Subcontracting Work or Hiring Assistants</strong></p> </section>
<section id="subcontracting-work-or-hiring-assistants">
<h3><span class="section-number">4.2.3. </span>Subcontracting Work or Hiring Assistants<a class="headerlink" href="#subcontracting-work-or-hiring-assistants" title="Link to this heading"></a></h3>
<p>As subcontracting work or hiring assistants can affect a worker’s chance of profit or risk of loss, this can help determine <p>As subcontracting work or hiring assistants can affect a worker’s chance of profit or risk of loss, this can help determine
the type of business relationship.</p> the type of business relationship.</p>
<p>The worker is an employee when:</p> <p>The worker is an employee when:</p>
@@ -212,7 +218,9 @@ the type of business relationship.</p>
<li><p>They can hire another party to complete the work, without consulting with the payer.</p></li> <li><p>They can hire another party to complete the work, without consulting with the payer.</p></li>
</ul> </ul>
</div></blockquote> </div></blockquote>
<p><strong>Financial Risk</strong></p> </section>
<section id="financial-risk">
<h3><span class="section-number">4.2.4. </span>Financial Risk<a class="headerlink" href="#financial-risk" title="Link to this heading"></a></h3>
<p>When evaluating the nature of a working relationship, the Canada Revenue Agency (CRA) considers whether the individual <p>When evaluating the nature of a working relationship, the Canada Revenue Agency (CRA) considers whether the individual
incurs fixed, ongoing costs or unreimbursed expenses. In traditional employee arrangements, employers typically reimburse incurs fixed, ongoing costs or unreimbursed expenses. In traditional employee arrangements, employers typically reimburse
expenses that arise as part of the job—for example, travel or business-related costs.</p> expenses that arise as part of the job—for example, travel or business-related costs.</p>
@@ -238,7 +246,9 @@ relationship, reflecting the independence and financial responsibility character
<li><p>The worker advertises the services offered.</p></li> <li><p>The worker advertises the services offered.</p></li>
</ul> </ul>
</div></blockquote> </div></blockquote>
<p><strong>Responsibility for Investment and Management</strong></p> </section>
<section id="responsibility-for-investment-and-management">
<h3><span class="section-number">4.2.5. </span>Responsibility for Investment and Management<a class="headerlink" href="#responsibility-for-investment-and-management" title="Link to this heading"></a></h3>
<p>When assessing whether a business relationship exists, one important indicator is the worker’s financial investment in the <p>When assessing whether a business relationship exists, one important indicator is the worker’s financial investment in the
services they provide. If an individual is required to invest in equipment, materials, or other resources to complete the services they provide. If an individual is required to invest in equipment, materials, or other resources to complete the
work, this suggests the presence of a contract for service rather than an employment relationship.</p> work, this suggests the presence of a contract for service rather than an employment relationship.</p>
@@ -259,7 +269,9 @@ reflect the autonomy and financial risk typically associated with self-employmen
<li><p>The worker has capital investment, manages his or her staff, hires and pays individuals to help perform the work, and has established a business presence.</p></li> <li><p>The worker has capital investment, manages his or her staff, hires and pays individuals to help perform the work, and has established a business presence.</p></li>
</ul> </ul>
</div></blockquote> </div></blockquote>
<p><strong>Opportunity for Profit</strong></p> </section>
<section id="opportunity-for-profit">
<h3><span class="section-number">4.2.6. </span>Opportunity for Profit<a class="headerlink" href="#opportunity-for-profit" title="Link to this heading"></a></h3>
<p>A business relationship is often indicated when a worker has the ability to realize a profit or incur a loss, reflecting their <p>A business relationship is often indicated when a worker has the ability to realize a profit or incur a loss, reflecting their
control over the financial and operational aspects of the services they provide. Self-employed individuals typically control over the financial and operational aspects of the services they provide. Self-employed individuals typically
negotiate their own rates, choose which contracts to accept, and may take on multiple contracts simultaneously. To fulfill negotiate their own rates, choose which contracts to accept, and may take on multiple contracts simultaneously. To fulfill
@@ -291,7 +303,7 @@ relationship.</p>
</section> </section>
</section> </section>
<section id="review-summary"> <section id="review-summary">
<h2><span class="section-number">4.2. </span>Review Summary<a class="headerlink" href="#review-summary" title="Link to this heading"></a></h2> <h2><span class="section-number">4.3. </span>Review Summary<a class="headerlink" href="#review-summary" title="Link to this heading"></a></h2>
<p>The core purpose of the payroll function within any organization is to ensure employees are compensated accurately and <p>The core purpose of the payroll function within any organization is to ensure employees are compensated accurately and
punctually, in accordance with all applicable legislation throughout the full annual payroll cycle. This essential function punctually, in accordance with all applicable legislation throughout the full annual payroll cycle. This essential function
supports employee satisfaction, regulatory compliance, and overall operational efficiency.</p> supports employee satisfaction, regulatory compliance, and overall operational efficiency.</p>
@@ -332,7 +344,7 @@ considerations include:</p>
<p>Collectively, these factors guide proper categorization for legal and tax purposes, helping organizations ensure compliance and mitigate potential risk.</p> <p>Collectively, these factors guide proper categorization for legal and tax purposes, helping organizations ensure compliance and mitigate potential risk.</p>
</section> </section>
<section id="review-questions"> <section id="review-questions">
<h2><span class="section-number">4.3. </span>Review Questions<a class="headerlink" href="#review-questions" title="Link to this heading"></a></h2> <h2><span class="section-number">4.4. </span>Review Questions<a class="headerlink" href="#review-questions" title="Link to this heading"></a></h2>
<p>What is the primary objective of the payroll department?</p> <p>What is the primary objective of the payroll department?</p>
<blockquote> <blockquote>
<div><p>The primary objective of the payroll department is to pay employees accurately and <div><p>The primary objective of the payroll department is to pay employees accurately and
@@ -438,11 +450,19 @@ morning at 10:00 to discuss?</em></p>
<li><a class="reference internal" href="#the-employee-employer-relationship">4.1. The Employee-Employer Relationship</a><ul> <li><a class="reference internal" href="#the-employee-employer-relationship">4.1. The Employee-Employer Relationship</a><ul>
<li><a class="reference internal" href="#contract-of-service-employment">4.1.1. Contract of Service (Employment)</a></li> <li><a class="reference internal" href="#contract-of-service-employment">4.1.1. Contract of Service (Employment)</a></li>
<li><a class="reference internal" href="#contract-for-service-subcontracting">4.1.2. Contract for Service (Subcontracting)</a></li> <li><a class="reference internal" href="#contract-for-service-subcontracting">4.1.2. Contract for Service (Subcontracting)</a></li>
<li><a class="reference internal" href="#factors-determining-the-type-of-contract">4.1.3. Factors Determining the Type of Contract</a></li>
</ul> </ul>
</li> </li>
<li><a class="reference internal" href="#review-summary">4.2. Review Summary</a></li> <li><a class="reference internal" href="#factors-determining-the-type-of-contract">4.2. Factors Determining the Type of Contract</a><ul>
<li><a class="reference internal" href="#review-questions">4.3. Review Questions</a></li> <li><a class="reference internal" href="#control">4.2.1. Control</a></li>
<li><a class="reference internal" href="#tools-and-equipment">4.2.2. Tools and Equipment</a></li>
<li><a class="reference internal" href="#subcontracting-work-or-hiring-assistants">4.2.3. Subcontracting Work or Hiring Assistants</a></li>
<li><a class="reference internal" href="#financial-risk">4.2.4. Financial Risk</a></li>
<li><a class="reference internal" href="#responsibility-for-investment-and-management">4.2.5. Responsibility for Investment and Management</a></li>
<li><a class="reference internal" href="#opportunity-for-profit">4.2.6. Opportunity for Profit</a></li>
</ul>
</li>
<li><a class="reference internal" href="#review-summary">4.3. Review Summary</a></li>
<li><a class="reference internal" href="#review-questions">4.4. Review Questions</a></li>
</ul> </ul>
</li> </li>
</ul> </ul>

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@@ -101,11 +101,19 @@ to confidently perform essential payroll functions encountered in day-to-day ope
<li class="toctree-l2"><a class="reference internal" href="contracts.html#the-employee-employer-relationship">4.1. The Employee-Employer Relationship</a><ul> <li class="toctree-l2"><a class="reference internal" href="contracts.html#the-employee-employer-relationship">4.1. The Employee-Employer Relationship</a><ul>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#contract-of-service-employment">4.1.1. Contract of Service (Employment)</a></li> <li class="toctree-l3"><a class="reference internal" href="contracts.html#contract-of-service-employment">4.1.1. Contract of Service (Employment)</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#contract-for-service-subcontracting">4.1.2. Contract for Service (Subcontracting)</a></li> <li class="toctree-l3"><a class="reference internal" href="contracts.html#contract-for-service-subcontracting">4.1.2. Contract for Service (Subcontracting)</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#factors-determining-the-type-of-contract">4.1.3. Factors Determining the Type of Contract</a></li>
</ul> </ul>
</li> </li>
<li class="toctree-l2"><a class="reference internal" href="contracts.html#review-summary">4.2. Review Summary</a></li> <li class="toctree-l2"><a class="reference internal" href="contracts.html#factors-determining-the-type-of-contract">4.2. Factors Determining the Type of Contract</a><ul>
<li class="toctree-l2"><a class="reference internal" href="contracts.html#review-questions">4.3. Review Questions</a></li> <li class="toctree-l3"><a class="reference internal" href="contracts.html#control">4.2.1. Control</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#tools-and-equipment">4.2.2. Tools and Equipment</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#subcontracting-work-or-hiring-assistants">4.2.3. Subcontracting Work or Hiring Assistants</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#financial-risk">4.2.4. Financial Risk</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#responsibility-for-investment-and-management">4.2.5. Responsibility for Investment and Management</a></li>
<li class="toctree-l3"><a class="reference internal" href="contracts.html#opportunity-for-profit">4.2.6. Opportunity for Profit</a></li>
</ul>
</li>
<li class="toctree-l2"><a class="reference internal" href="contracts.html#review-summary">4.3. Review Summary</a></li>
<li class="toctree-l2"><a class="reference internal" href="contracts.html#review-questions">4.4. Review Questions</a></li>
</ul> </ul>
</li> </li>
<li class="toctree-l1"><a class="reference internal" href="cpp-and-ei.html">5. Canada Pension Plan</a><ul> <li class="toctree-l1"><a class="reference internal" href="cpp-and-ei.html">5. Canada Pension Plan</a><ul>

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# Sphinx build info version 1 # Sphinx build info version 1
# This file records the configuration used when building these files. When it is not found, a full rebuild will be done. # This file records the configuration used when building these files. When it is not found, a full rebuild will be done.
config: 7065f63853f6278895418bdb8c6d54f8 config: b2f5032efd54e8bed56ef20304da5624
tags: 62a1e7829a13fc7881b6498c52484ec0 tags: 62a1e7829a13fc7881b6498c52484ec0

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@@ -274,21 +274,53 @@
4.1.2. Contract for Service (Subcontracting) 4.1.2. Contract for Service (Subcontracting)
</a> </a>
</li> </li>
</ul>
</li>
<li class="toctree-l2">
<a class="reference internal" href="#factors-determining-the-type-of-contract">
4.2. Factors Determining the Type of Contract
</a>
<ul>
<li class="toctree-l3"> <li class="toctree-l3">
<a class="reference internal" href="#factors-determining-the-type-of-contract"> <a class="reference internal" href="#control">
4.1.3. Factors Determining the Type of Contract 4.2.1. Control
</a>
</li>
<li class="toctree-l3">
<a class="reference internal" href="#tools-and-equipment">
4.2.2. Tools and Equipment
</a>
</li>
<li class="toctree-l3">
<a class="reference internal" href="#subcontracting-work-or-hiring-assistants">
4.2.3. Subcontracting Work or Hiring Assistants
</a>
</li>
<li class="toctree-l3">
<a class="reference internal" href="#financial-risk">
4.2.4. Financial Risk
</a>
</li>
<li class="toctree-l3">
<a class="reference internal" href="#responsibility-for-investment-and-management">
4.2.5. Responsibility for Investment and Management
</a>
</li>
<li class="toctree-l3">
<a class="reference internal" href="#opportunity-for-profit">
4.2.6. Opportunity for Profit
</a> </a>
</li> </li>
</ul> </ul>
</li> </li>
<li class="toctree-l2"> <li class="toctree-l2">
<a class="reference internal" href="#review-summary"> <a class="reference internal" href="#review-summary">
4.2. Review Summary 4.3. Review Summary
</a> </a>
</li> </li>
<li class="toctree-l2"> <li class="toctree-l2">
<a class="reference internal" href="#review-questions"> <a class="reference internal" href="#review-questions">
4.3. Review Questions 4.4. Review Questions
</a> </a>
</li> </li>
</ul> </ul>
@@ -3459,92 +3491,95 @@ invoice alone is not sufficient to confirm self-employment status. Proper assess
sto ensure accurate classification and compliance with tax and labor regulations. sto ensure accurate classification and compliance with tax and labor regulations.
</p> </p>
</section> </section>
<section id="factors-determining-the-type-of-contract"> </section>
<h4> <section id="factors-determining-the-type-of-contract">
Factors Determining the Type of Contract <h3>
<a class="headerlink" href="#factors-determining-the-type-of-contract" title="Link to this heading"> Factors Determining the Type of Contract
&para; <a class="headerlink" href="#factors-determining-the-type-of-contract" title="Link to this heading">
</a> &para;
</h4> </a>
<p> </h3>
The CRA uses a two-step approach to examine the relationship between the worker and the <p>
The CRA uses a two-step approach to examine the relationship between the worker and the
payer for relationships outside the province of Qu&eacute;bec. The approach used for relationships payer for relationships outside the province of Qu&eacute;bec. The approach used for relationships
in the province of Qu&eacute;bec will be discussed in a later chapter. in the province of Qu&eacute;bec will be discussed in a later chapter.
</p> </p>
<p> <p>
<strong> <strong>
Step 1: Step 1:
</strong> </strong>
The first step is to establish what the intent was when the worker and the payer entered into The first step is to establish what the intent was when the worker and the payer entered into
the working arrangement. Did they intend to enter into an employee-employer relationship the working arrangement. Did they intend to enter into an employee-employer relationship
(contract of service) or did they intend to enter into a business relationship (contract for (contract of service) or did they intend to enter into a business relationship (contract for
service). The CRA must determine not only how the working relationship has been defined service). The CRA must determine not only how the working relationship has been defined
but why it was defined that way. but why it was defined that way.
</p> </p>
<p> <p>
<strong> <strong>
Step 2: Step 2:
</strong> </strong>
The CRA then considers certain factors when determining if a contract of service or a The CRA then considers certain factors when determining if a contract of service or a
contract for service exists. In order to understand the working relationship and verify that the contract for service exists. In order to understand the working relationship and verify that the
intent of the worker and the payer is reflected in the facts, they will ask a series of questions intent of the worker and the payer is reflected in the facts, they will ask a series of questions
that relate to the following factors: that relate to the following factors:
</p> </p>
<blockquote> <blockquote>
<div> <div>
<ul class="simple"> <ul class="simple">
<li> <li>
<p> <p>
the level of control the payer has over the worker the level of control the payer has over the worker
</p> </p>
</li> </li>
<li> <li>
<p> <p>
whether or not the worker provides the tools and equipment whether or not the worker provides the tools and equipment
</p> </p>
</li> </li>
<li> <li>
<p> <p>
whether the worker can subcontract the work or hire assistants whether the worker can subcontract the work or hire assistants
</p> </p>
</li> </li>
<li> <li>
<p> <p>
the degree of financial risk taken by the worker the degree of financial risk taken by the worker
</p> </p>
</li> </li>
<li> <li>
<p> <p>
the degree of responsibility for investment and management held by the worker the degree of responsibility for investment and management held by the worker
</p> </p>
</li> </li>
<li> <li>
<p> <p>
the worker&rsquo;s opportunity for profit the worker&rsquo;s opportunity for profit
</p> </p>
</li> </li>
<li> <li>
<p> <p>
any other relevant factors, such as written contracts any other relevant factors, such as written contracts
</p> </p>
</li> </li>
</ul> </ul>
</div> </div>
</blockquote> </blockquote>
<p> <p>
The CRA will look at the answers independently and then together and consider whether or The CRA will look at the answers independently and then together and consider whether or
not they reflect the intent that was originally stated. Considered individually, the response to not they reflect the intent that was originally stated. Considered individually, the response to
each of these questions is not conclusive; however, when weighed together, certain each of these questions is not conclusive; however, when weighed together, certain
conclusions may be drawn. When there is no common intent, the CRA will decide if the conclusions may be drawn. When there is no common intent, the CRA will decide if the
answers are more consistent with a contract of service or a contract for service. answers are more consistent with a contract of service or a contract for service.
Each of these factors will be discussed in the material and indicators showing whether the Each of these factors will be discussed in the material and indicators showing whether the
worker is an employee or self-employed will be provided. worker is an employee or self-employed will be provided.
</p> </p>
<p> <section id="control">
<strong> <h4>
Control Control
</strong> <a class="headerlink" href="#control" title="Link to this heading">
</p> &para;
</a>
</h4>
<p> <p>
One of the key factors in determining a worker&rsquo;s status is the extent to which the payer has the ability, authority, or One of the key factors in determining a worker&rsquo;s status is the extent to which the payer has the ability, authority, or
right to control both what work is performed and how it is carried out. Equally important is the level of independence the right to control both what work is performed and how it is carried out. Equally important is the level of independence the
@@ -3626,11 +3661,14 @@ used&mdash;that holds the most weight in determining the nature of the working r
</ul> </ul>
</div> </div>
</blockquote> </blockquote>
<p> </section>
<strong> <section id="tools-and-equipment">
Tools and Equipment <h4>
</strong> Tools and Equipment
</p> <a class="headerlink" href="#tools-and-equipment" title="Link to this heading">
&para;
</a>
</h4>
<p> <p>
Ownership of tools and equipment is not a definitive factor in determining the nature of a working relationship or the type Ownership of tools and equipment is not a definitive factor in determining the nature of a working relationship or the type
of contract in place. While self-employed individuals often use their own tools to fulfill contractual obligations&mdash;making of contract in place. While self-employed individuals often use their own tools to fulfill contractual obligations&mdash;making
@@ -3695,11 +3733,14 @@ replacement, and insurance, rather than mere ownership itself.
</ul> </ul>
</div> </div>
</blockquote> </blockquote>
<p> </section>
<strong> <section id="subcontracting-work-or-hiring-assistants">
Subcontracting Work or Hiring Assistants <h4>
</strong> Subcontracting Work or Hiring Assistants
</p> <a class="headerlink" href="#subcontracting-work-or-hiring-assistants" title="Link to this heading">
&para;
</a>
</h4>
<p> <p>
As subcontracting work or hiring assistants can affect a worker&rsquo;s chance of profit or risk of loss, this can help determine As subcontracting work or hiring assistants can affect a worker&rsquo;s chance of profit or risk of loss, this can help determine
the type of business relationship. the type of business relationship.
@@ -3742,11 +3783,14 @@ the type of business relationship.
</ul> </ul>
</div> </div>
</blockquote> </blockquote>
<p> </section>
<strong> <section id="financial-risk">
Financial Risk <h4>
</strong> Financial Risk
</p> <a class="headerlink" href="#financial-risk" title="Link to this heading">
&para;
</a>
</h4>
<p> <p>
When evaluating the nature of a working relationship, the Canada Revenue Agency (CRA) considers whether the individual When evaluating the nature of a working relationship, the Canada Revenue Agency (CRA) considers whether the individual
incurs fixed, ongoing costs or unreimbursed expenses. In traditional employee arrangements, employers typically reimburse incurs fixed, ongoing costs or unreimbursed expenses. In traditional employee arrangements, employers typically reimburse
@@ -3812,11 +3856,14 @@ relationship, reflecting the independence and financial responsibility character
</ul> </ul>
</div> </div>
</blockquote> </blockquote>
<p> </section>
<strong> <section id="responsibility-for-investment-and-management">
Responsibility for Investment and Management <h4>
</strong> Responsibility for Investment and Management
</p> <a class="headerlink" href="#responsibility-for-investment-and-management" title="Link to this heading">
&para;
</a>
</h4>
<p> <p>
When assessing whether a business relationship exists, one important indicator is the worker&rsquo;s financial investment in the When assessing whether a business relationship exists, one important indicator is the worker&rsquo;s financial investment in the
services they provide. If an individual is required to invest in equipment, materials, or other resources to complete the services they provide. If an individual is required to invest in equipment, materials, or other resources to complete the
@@ -3861,11 +3908,14 @@ reflect the autonomy and financial risk typically associated with self-employmen
</ul> </ul>
</div> </div>
</blockquote> </blockquote>
<p> </section>
<strong> <section id="opportunity-for-profit">
Opportunity for Profit <h4>
</strong> Opportunity for Profit
</p> <a class="headerlink" href="#opportunity-for-profit" title="Link to this heading">
&para;
</a>
</h4>
<p> <p>
A business relationship is often indicated when a worker has the ability to realize a profit or incur a loss, reflecting their A business relationship is often indicated when a worker has the ability to realize a profit or incur a loss, reflecting their
control over the financial and operational aspects of the services they provide. Self-employed individuals typically control over the financial and operational aspects of the services they provide. Self-employed individuals typically