alex/CanadianPayroll
1
0
Fork 0
mirror of https://github.com/alexandrebobkov/CanadianPayroll.git synced 2025-09-08 07:09:17 +00:00
Code Issues Packages Projects Releases Wiki Activity

intro

Browse Source
This commit is contained in:
Alex B.
2025-08-23 01:44:53 -04:00
parent ab9b233b33
commit 8d29df4ff9
9 changed files with 1181 additions and 1181 deletions
Download Patch File Download Diff File Expand all files Collapse all files

78
docs/build/html/contracts.html vendored
View File

@@ -5,7 +5,7 @@
<meta charset="utf-8" />
<meta name="viewport" content="width=device-width, initial-scale=1.0" /><meta name="viewport" content="width=device-width, initial-scale=1" />
<title>4. EMPLOYEE vs. INDEPENDENT CONTRACTOR &#8212; 🍁 Payroll Administration Fall 2025 (v25.08.23) documentation</title>
<title>3. EMPLOYEE vs. INDEPENDENT CONTRACTOR &#8212; 🍁 Payroll Administration Fall 2025 (v25.08.23) documentation</title>
<link rel="stylesheet" type="text/css" href="_static/pygments.css?v=03e43079" />
<link rel="stylesheet" type="text/css" href="_static/classic.css?v=2bf1fcf8" />
@@ -15,8 +15,8 @@
<link rel="index" title="Index" href="genindex.html" />
<link rel="search" title="Search" href="search.html" />
<link rel="next" title="5. Canada Pension Plan" href="cpp-and-ei.html" />
<link rel="prev" title="3. PAYROLL COMPLIANCE AND REGULATIONS" href="compliance.html" />
<link rel="next" title="4. PAYROLL COMPLIANCE AND REGULATIONS" href="compliance.html" />
<link rel="prev" title="2. INTRODUCTION TO CANADIAN PAYROLL" href="introduction.html" />
</head><body>
<div class="related" role="navigation" aria-label="Related">
<h3>Navigation</h3>
@@ -25,13 +25,13 @@
<a href="genindex.html" title="General Index"
accesskey="I">index</a></li>
<li class="right" >
<a href="cpp-and-ei.html" title="5. Canada Pension Plan"
<a href="compliance.html" title="4. PAYROLL COMPLIANCE AND REGULATIONS"
accesskey="N">next</a> |</li>
<li class="right" >
<a href="compliance.html" title="3. PAYROLL COMPLIANCE AND REGULATIONS"
<a href="introduction.html" title="2. INTRODUCTION TO CANADIAN PAYROLL"
accesskey="P">previous</a> |</li>
<li class="nav-item nav-item-0"><a href="index.html">🍁 Payroll Administration Fall 2025 (v25.08.23) documentation</a> &#187;</li>
<li class="nav-item nav-item-this"><a href=""><span class="section-number">4. </span>EMPLOYEE vs. INDEPENDENT CONTRACTOR</a></li>
<li class="nav-item nav-item-this"><a href=""><span class="section-number">3. </span>EMPLOYEE vs. INDEPENDENT CONTRACTOR</a></li>
</ul>
</div>
@@ -41,9 +41,9 @@
<div class="body" role="main">
<section id="employee-vs-independent-contractor">
<h1><span class="section-number">4. </span>EMPLOYEE vs. INDEPENDENT CONTRACTOR<a class="headerlink" href="#employee-vs-independent-contractor" title="Link to this heading"></a></h1>
<h1><span class="section-number">3. </span>EMPLOYEE vs. INDEPENDENT CONTRACTOR<a class="headerlink" href="#employee-vs-independent-contractor" title="Link to this heading"></a></h1>
<section id="the-employee-employer-relationship">
<h2><span class="section-number">4.1. </span>The Employee-Employer Relationship<a class="headerlink" href="#the-employee-employer-relationship" title="Link to this heading"></a></h2>
<h2><span class="section-number">3.1. </span>The Employee-Employer Relationship<a class="headerlink" href="#the-employee-employer-relationship" title="Link to this heading"></a></h2>
<p>Determining the nature of the working relationship between an individual and an organization is essential in all employment situations. Whether the individual is classified as an employee or self-employed directly affects the statutory withholding requirements and the organization’s compliance with applicable legislation. To support this assessment, the Canada Revenue Agency (CRA) provides a set of guidelines designed to help distinguish between the two classifications. Importantly, the decision is not made by the worker but must be based on objective criteria and legal standards.</p>
<p>Payroll practitioners play an important role in promoting awareness of this distinction throughout the organization. By proactively communicating the significance of establishing a valid employee-employer relationship, payroll professionals help ensure that employment classifications are accurate and compliant.</p>
<p>Once an employee-employer relationship is confirmed, the payroll department becomes responsible for meeting compliance obligations related to statutory withholdings. This includes deducting the appropriate amounts—such as income tax, Canada Pension Plan contributions, and Employment Insurance premiums—from employee pay and remitting them to the government within the required timelines. Proper classification and adherence to these rules are key to maintaining legal and financial accountability.</p>
@@ -61,7 +61,7 @@
Canada Revenue Agency guide, Employee or Self-Employed? - RC4110. The guide is available on the CRA’s website,
<a class="reference external" href="https://www.canada.ca/en/revenue-agency.html">https://www.canada.ca/en/revenue-agency.html</a>.</p>
<section id="contract-of-service-employment">
<h3><span class="section-number">4.1.1. </span>Contract of Service (Employment)<a class="headerlink" href="#contract-of-service-employment" title="Link to this heading"></a></h3>
<h3><span class="section-number">3.1.1. </span>Contract of Service (Employment)<a class="headerlink" href="#contract-of-service-employment" title="Link to this heading"></a></h3>
<p>A <strong>contract of service</strong> is an arrangement whereby an individual (the employee) agrees to
work on a full-time or part-time basis for an employer for a specified or indeterminate period
of time.</p>
@@ -69,7 +69,7 @@ of time.</p>
of remuneration.</p>
</section>
<section id="contract-for-service-subcontracting">
<h3><span class="section-number">4.1.2. </span>Contract for Service (Subcontracting)<a class="headerlink" href="#contract-for-service-subcontracting" title="Link to this heading"></a></h3>
<h3><span class="section-number">3.1.2. </span>Contract for Service (Subcontracting)<a class="headerlink" href="#contract-for-service-subcontracting" title="Link to this heading"></a></h3>
<p>A <strong>contract for service</strong> is a business relationship whereby one party agrees to perform certain
specific work stipulated in the contract for another party. It usually calls for the
accomplishment of a clearly defined task but does not normally require that the contracting
@@ -108,7 +108,7 @@ sto ensure accurate classification and compliance with tax and labor regulations
</section>
</section>
<section id="factors-determining-the-type-of-contract">
<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>
<h2><span class="section-number">3.2. </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
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>
@@ -142,7 +142,7 @@ 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
worker is an employee or self-employed will be provided.</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>
<h3><span class="section-number">3.2.1. </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
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>
@@ -170,7 +170,7 @@ used—that holds the most weight in determining the nature of the working relat
</div></blockquote>
</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>
<h3><span class="section-number">3.2.2. </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
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
@@ -201,7 +201,7 @@ replacement, and insurance, rather than mere ownership itself.</p>
</div></blockquote>
</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>
<h3><span class="section-number">3.2.3. </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
the type of business relationship.</p>
<p>The worker is an employee when:</p>
@@ -220,7 +220,7 @@ the type of business relationship.</p>
</div></blockquote>
</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>
<h3><span class="section-number">3.2.4. </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
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>
@@ -248,7 +248,7 @@ relationship, reflecting the independence and financial responsibility character
</div></blockquote>
</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>
<h3><span class="section-number">3.2.5. </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
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>
@@ -271,7 +271,7 @@ reflect the autonomy and financial risk typically associated with self-employmen
</div></blockquote>
</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>
<h3><span class="section-number">3.2.6. </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
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
@@ -303,7 +303,7 @@ relationship.</p>
</section>
</section>
<section id="review-summary">
<h2><span class="section-number">4.3. </span>Review Summary<a class="headerlink" href="#review-summary" title="Link to this heading"></a></h2>
<h2><span class="section-number">3.3. </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
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>
@@ -344,7 +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>
</section>
<section id="review-questions">
<h2><span class="section-number">4.4. </span>Review Questions<a class="headerlink" href="#review-questions" title="Link to this heading"></a></h2>
<h2><span class="section-number">3.4. </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>
<blockquote>
<div><p>The primary objective of the payroll department is to pay employees accurately and
@@ -446,23 +446,23 @@ morning at 10:00 to discuss?</em></p>
<div>
<h3><a href="index.html">Table of Contents</a></h3>
<ul>
<li><a class="reference internal" href="#">4. EMPLOYEE vs. INDEPENDENT CONTRACTOR</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-for-service-subcontracting">4.1.2. Contract for Service (Subcontracting)</a></li>
<li><a class="reference internal" href="#">3. EMPLOYEE vs. INDEPENDENT CONTRACTOR</a><ul>
<li><a class="reference internal" href="#the-employee-employer-relationship">3.1. The Employee-Employer Relationship</a><ul>
<li><a class="reference internal" href="#contract-of-service-employment">3.1.1. Contract of Service (Employment)</a></li>
<li><a class="reference internal" href="#contract-for-service-subcontracting">3.1.2. Contract for Service (Subcontracting)</a></li>
</ul>
</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="#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>
<li><a class="reference internal" href="#factors-determining-the-type-of-contract">3.2. Factors Determining the Type of Contract</a><ul>
<li><a class="reference internal" href="#control">3.2.1. Control</a></li>
<li><a class="reference internal" href="#tools-and-equipment">3.2.2. Tools and Equipment</a></li>
<li><a class="reference internal" href="#subcontracting-work-or-hiring-assistants">3.2.3. Subcontracting Work or Hiring Assistants</a></li>
<li><a class="reference internal" href="#financial-risk">3.2.4. Financial Risk</a></li>
<li><a class="reference internal" href="#responsibility-for-investment-and-management">3.2.5. Responsibility for Investment and Management</a></li>
<li><a class="reference internal" href="#opportunity-for-profit">3.2.6. 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>
<li><a class="reference internal" href="#review-summary">3.3. Review Summary</a></li>
<li><a class="reference internal" href="#review-questions">3.4. Review Questions</a></li>
</ul>
</li>
</ul>
@@ -470,13 +470,13 @@ morning at 10:00 to discuss?</em></p>
</div>
<div>
<h4>Previous topic</h4>
<p class="topless"><a href="compliance.html"
title="previous chapter"><span class="section-number">3. </span>PAYROLL COMPLIANCE AND REGULATIONS</a></p>
<p class="topless"><a href="introduction.html"
title="previous chapter"><span class="section-number">2. </span>INTRODUCTION TO CANADIAN PAYROLL</a></p>
</div>
<div>
<h4>Next topic</h4>
<p class="topless"><a href="cpp-and-ei.html"
title="next chapter"><span class="section-number">5. </span>Canada Pension Plan</a></p>
<p class="topless"><a href="compliance.html"
title="next chapter"><span class="section-number">4. </span>PAYROLL COMPLIANCE AND REGULATIONS</a></p>
</div>
<div role="note" aria-label="source link">
<h3>This Page</h3>
@@ -506,13 +506,13 @@ morning at 10:00 to discuss?</em></p>
<a href="genindex.html" title="General Index"
>index</a></li>
<li class="right" >
<a href="cpp-and-ei.html" title="5. Canada Pension Plan"
<a href="compliance.html" title="4. PAYROLL COMPLIANCE AND REGULATIONS"
>next</a> |</li>
<li class="right" >
<a href="compliance.html" title="3. PAYROLL COMPLIANCE AND REGULATIONS"
<a href="introduction.html" title="2. INTRODUCTION TO CANADIAN PAYROLL"
>previous</a> |</li>
<li class="nav-item nav-item-0"><a href="index.html">🍁 Payroll Administration Fall 2025 (v25.08.23) documentation</a> &#187;</li>
<li class="nav-item nav-item-this"><a href=""><span class="section-number">4. </span>EMPLOYEE vs. INDEPENDENT CONTRACTOR</a></li>
<li class="nav-item nav-item-this"><a href=""><span class="section-number">3. </span>EMPLOYEE vs. INDEPENDENT CONTRACTOR</a></li>
</ul>
</div>
<div class="footer" role="contentinfo">