| What's the Scoop? |
|
|
TaxTips.ca commentary
|
|
|
MP's study PSBs - IT professional contracts
|
|
|
KPMG article 2013
|
|
|
Blunt Bean Counter Blog Jan 24, 2026
|
|
|
CGA Canada Magazine article 2007
|
|
|
Ottawa Business Journal - Nov 18 2010
|
| Guides: Active Business Income |
|
|
Incorporated and self-employed? not likely...
Owner/Manager of your own corporation? Unclear about payroll status? Review the Business section of the CRA Home page and the payroll rules.
If you own the corporation, it is not likely that you are self-employed, it's very likely you will be considered an employee of your corporation. T4012 T2 Corporation - Income Tax Guide provides guidance in Chapter 4.
|
|
|
Corporation Guide T4012
Chapter 4: Only Active Business Income qualifies for a Small Business Deduction
Introduction to ABI and SIB (Specified investment business)
What's important? The description of what is NOT considered to be Active Business Income
|
| Interpretation Bulletins |
|
|
The Small Business Deduction
See position in paragraph 15
|
|
|
IT432 Benefits Conferred on Shareholders
|
|
|
IT421 Benefits to individuals, corporations...
See mention of "personal services business" under benefits to employees
|
| Forms |
|
|
T2SCH7 Calculation of AII and ABI
|
| Income Tax Act |
|
|
S. 18(1)(p) limitation personal services expenses
|
|
|
ITA S.125(7) Definition
|
|
|
Draft Legislation October 31 2011
|
|
|
See Clause 26, 27 re limitation on SBD
|
| Other compliance |
|
|
Association of Workers' Compensation Boards
Review provincial/territorial Workers Compensation regulations for personal services business's. A corporation may not qualify to self-insure if their only client is one large client. They may be refunded premiums and the client required to pay the premiums as if they were an employee even though they are incorporated.
|
| Court cases |
|
|
489599 B.C. Ltd. v The Queen, 2008 TCC 332
Departure from Federal Court Hughes & Co.
489599 BC Ltd. has been accepted by CRA and "more than 5 full-time employees" can mean 5 plus a part-time employee.
CRA now accepts VIEWS doc 2008-0300581C6, Income Tax Technical News ITTN-41 and 2008 Cdn Tax Foundation conference report at 3:5-6 (superseding IT-73R6 para. 15).
In 1994, Justice Muldoon in Hughes case argued that at least six full-time employees were required and that part time employees were not contemplated.
In 2008, Justice Campbell disagreed and said that five full-time employees and at least one part-timer would qualify, making the company eligible for the small business tax rate and deductability of non-employee in nature business expenses.
|
|
|
The Queen v Hughes & Co. Holdings Ltd. 94 DTC 6511
Not available on Canlii (starts posting in 1996)
|
|
|
Lerric Investments Corp v Canada 2001 FCA 14
|
|
|
Lerric Investments Corp v The Queen 1999 Canlii396
|
| Employee or self-employed? |
|
|
Payroll
|
|
|
RC4110 Employee or Self-Employed
|
|
|
CPP EI explained
|
