Self-Employed / Contractor Clarifications !! Please read if applicable

[Dilbert]

I understand this is a huge grey area for some of you. I was in a similar situation and have successfully got my PNP nomination and got an ITA this morning.
NOTE** I did NOT select the "self-employed" checkbox in the EE profile as I do not consider myself to be one based on the research I did online on CEC & CRA websites. Refer link below

Let me give you my background history and then shed some light on self-employment category.

Total work experience =2 (1 + 1) under 2 different NOC 2282(IT Support Analyst(help-desk role) & 2171 (IT Consultant) )

1st Year experience : This was on payroll, hence does not come under self-employment category as my taxes were part of the salary.
2nd Year experience : Worked for an IT staffing agency as for a third-party company as a contractor. Now most of you who work in the IT area and are acting as a contractor would come under this category. Since I am not on a payroll with the company and the agency pays me directly including HST, I had to open up an incorporation (also termed as a small business account).This to me is where the confusion lies regarding self-employment for most of you.

If the following applies to you then you are NOT self-employed!!:
1) Fixed roles & responsibilities as described by your hiring manager
2) Fixed working hours (9-5 in my case)
3) Fixed salary per hour and NOT a variable rate based on daily services rendered
4) All assets are provided by the company/agency ( example : working cubicle, laptop, software use, hardware use and remains company property ). This might not be applicable for some of you.

Official details and explanation can be found within the links below
1) http://www.cra-arc.gc.ca/formspubs/menu-eng.html
2) http://www.cra-arc.gc.ca/tx/hm/xplnd/itc-eng.html
3) http://www.cra-arc.gc.ca/E/pub/tp/it73r6/it73r6-e.html
4) http://www.cra-arc.gc.ca/tx/hm/xplnd/rlng-eng.html
5) http://www.cra-arc.gc.ca/tx/hm/xplnd/plcmnt-eng.html

NOTE** You do not require an official ruling from CRA to determine whether you are self-employed of not. Just by reading through the manifest you can determine your own employment status.
You are considered to be self-employed in the following cases.
1) If you do not have fixed working hours (example : farmer, taxi/uber driver, artist, free-lance worker, coffee shop owner etc...)
2) Your duties & responsibilities and employers change on regular basis
3) You sales or services rendered vary daily/weekly
4) You provide your own hardware/ tools/ software and charge the client accordingly.

Now having identified what accounts for self-employed and what's not. As I said I have received the PNP nomination. There are additional documentation / details that I had to submit to CIC/PNP in my case. If applicable in your case you would need to submit the same.
1) Certification of Incorporation - show's when the company was registered
2) Certification of Ownership - shows who the owner of the company is
3) Certification of Compliance - shows current company ACTIVE status and if taxes are paid
4) Tax receipts/filing status
5) Letter from agency & employer - shows a link that I am hired by the agency but work for the employer.
Letter from the agency : Mentions that my contract is from such and such date and my company name and also mentions that my roles & responsibilities are defined by the 3rd party employer XYZ and mentions hourly rate and biweekly payment schedule

letter from the Employer : mentions all the relevant details, such as start-date, end-date, agency name, roles & responsibilities , signed by my reporting manager, HR manager ... etc (incase I have missed anything please add)

 

[yengyeng]

What happens in a case where I am not incorporated? I requested for a business number from CRA and will be filing my taxes by the end of the year?

 

[Dilbert]

What happens in a case where I am not incorporated? I requested for a business number from CRA and will be filing my taxes by the end of the year?

Kindly provide me with more details so I can better answer your query:
1) How long have you been working and whether or not you were on a company payroll ?
2) are you working for an employment agency ?
3) What is your current mode of remuneration ? How are you currently paid
4) Why did you request for a Business Number from CRA ? Who asked you to do it and why ?
5) Based on the information I provided to you, what is your self conclusion ? Are you considered as self-employed or NOT ?

 

[canadavisa1525]

Hello,

I am newbie to this forum let me explain my situation :

Me and my wife : She is primary applicant and I am dependent.We already had received ITA under fsw inland in july. She work full time on payroll for last 2 year.Me also use to work on payroll for last 2 year but in April I got the contract job and open incorporation but before that I already worked for more then 2 year on payroll.

Now I am dependent does this will effect my application as I am not considering any points for contract job because as I receive 7 points for 2 years experience, contract job I am doing as an fixed third party in telecommunication with fixed pay, time, desk and all.

One more I have checked mark as self employed after April 2015, as i think still we need to let them know what you doing currently, but I have put that in work history even not considering points.

Pleaseeeeeee help me explain situation properly or i can go back to payroll.

Thanks,


FSW inland
17th July
AOR Aug 21st
RCMp received
wife principal applicant working on payroll
dependent me use to work for more then 2 year on payroll but switch to Contract in April
Ecas in process 6 line

 

[yengyeng]

1. I have been working for 10 months now.
2. I am working on my own. Like a contractor. I invoice the company based on the number of hours worked.
3. I get paid per hour. The company pays directly into my account at the end of the month.
4. I requested for for BN coz it states on my contract agreement that I am not incorporated.
5. I believe I am self employed or what do you think?
Kindly provide me with more details so I can better answer your query:
1) How long have you been working and whether or not you were on a company payroll ?
2) are you working for an employment agency ?
3) What is your current mode of remuneration ? How are you currently paid
4) Why did you request for a Business Number from CRA ? Who asked you to do it and why ?
5) Based on the information I provided to you, what is your self conclusion ? Are you considered as self-employed or NOT ?

 

[Skvach]

NOTE** I did NOT select the "self-employed" checkbox in the EE profile as I do not consider myself to be one based on the research I did online on CEC & CRA websites.

You are considered to be self-employed in the following cases.
1) If you do not have fixed working hours (example : farmer, taxi/uber driver, artist, free-lance worker, coffee shop owner etc...)
2) Your duties & responsibilities and employers change on regular basis
3) You sales or services rendered vary daily/weekly
4) You provide your own hardware/ tools/ software and charge the client accordingly.

Now having identified what accounts for self-employed and what's not. As I said I have received the PNP nomination. There are additional documentation / details that I had to submit to CIC/PNP in my case. If applicable in your case you would need to submit the same.
1) Certification of Incorporation - show's when the company was registered
2) Certification of Ownership - shows who the owner of the company is
3) Certification of Compliance - shows current company ACTIVE status and if taxes are paid
4) Tax receipts/filing status
5) Letter from agency & employer - shows a link that I am hired by the agency but work for the employer.

There is little information about self-employment in the internet.

However, as a shop owner I've selected self-employed box and now searching for supporting documents.
Certifications and tax receipts are not a problem, while references might be an issue.
I run a retail shop so it is impossible to find references from customers who bought something in my shop 1-2-3-5 years ago.
I've ordered a list of transactions from my bank account to prove that the business has been active.
I can also provide a lease agreement to prove that I have a shop.
I'm also considering asking for references from my accountant, the company I'm renting my retail property form, a bank clerk who is processing my bank account, a few recent customers, my employees ( I have 2).

As I have a cash register and each day I print a report indicating the day's sales, I can send some receipts or even all of them. However, they only indicate a date and the total sales.

I have a bank loan with an indication of my status as self-employed person, maybe it would be wise to send it too.

 

[Dilbert]

There is little information about self-employment in the internet.

However, as a shop owner I've selected self-employed box and now searching for supporting documents.
Certifications and tax receipts are not a problem, while references might be an issue.
I run a retail shop so it is impossible to find references from customers who bought something in my shop 1-2-3-5 years ago.
I've ordered a list of transactions from my bank account to prove that the business has been active.
I can also provide a lease agreement to prove that I have a shop.
I'm also considering asking for references from my accountant, the company I'm renting my retail property form, a bank clerk who is processing my bank account, a few recent customers, my employees ( I have 2).

As I have a cash register and each day I print a report indicating the day's sales, I can send some receipts or even all of them. However, they only indicate a date and the total sales.

I have a bank loan with an indication of my status as self-employed person, maybe it would be wise to send it too.

From what you have described, you are considered as Self-Employed. You cannot claim points in CRS if you come under the CEC criteria. The criteria that I defined in my first post is for CEC applicants only. For FSW the self-employed experience is counted, I am not sure about the required documentation.

can you give me some more information regarding your current status ? Your express entry profile, your score, what category you filed for , your NOC ...etc

 

[Dilbert]

Sorry, I should have included the following questions as well. Your answers do not give me enough information to assess your employment category.

Are you working fixed hours? Ex: 9-5 or are you usually on call and report to work whenever ?
Do you work at the company on-site or you work from home ?
Does your company provide you with any hardware/software assets for your work or do you bring your own ?
Does your hourly rate change frequently ?
Contractor is a general description. Which field are you working in. What is your NOC category ?
You mentioned you have been working for 10 months and you still don't have a Business Number yet ? Are you paid cash/ cheque ? is the HST included in your pay ?

 

[Anya654]

I understand this is a huge grey area for some of you. I was in a similar situation and have successfully got my PNP nomination and got an ITA this morning.
NOTE** I did NOT select the "self-employed" checkbox in the EE profile as I do not consider myself to be one based on the research I did online on CEC & CRA websites. Refer link below

Let me give you my background history and then shed some light on self-employment category.

Total work experience =2 (1 + 1) under 2 different NOC 2282(IT Support Analyst(help-desk role) & 2171 (IT Consultant) )

1st Year experience : This was on payroll, hence does not come under self-employment category as my taxes were part of the salary.
2nd Year experience : Worked for an IT staffing agency as for a third-party company as a contractor. Now most of you who work in the IT area and are acting as a contractor would come under this category. Since I am not on a payroll with the company and the agency pays me directly including HST, I had to open up an incorporation (also termed as a small business account).This to me is where the confusion lies regarding self-employment for most of you.

If the following applies to you then you are NOT self-employed!!:
1) Fixed roles & responsibilities as described by your hiring manager
2) Fixed working hours (9-5 in my case)
3) Fixed salary per hour and NOT a variable rate based on daily services rendered
4) All assets are provided by the company/agency ( example : working cubicle, laptop, software use, hardware use and remains company property ). This might not be applicable for some of you.

Official details and explanation can be found within the links below
1) http://www.cra-arc.gc.ca/formspubs/menu-eng.html
2) http://www.cra-arc.gc.ca/tx/hm/xplnd/itc-eng.html
3) http://www.cra-arc.gc.ca/E/pub/tp/it73r6/it73r6-e.html
4) http://www.cra-arc.gc.ca/tx/hm/xplnd/rlng-eng.html
5) http://www.cra-arc.gc.ca/tx/hm/xplnd/plcmnt-eng.html

NOTE** You do not require an official ruling from CRA to determine whether you are self-employed of not. Just by reading through the manifest you can determine your own employment status.
You are considered to be self-employed in the following cases.
1) If you do not have fixed working hours (example : farmer, taxi/uber driver, artist, free-lance worker, coffee shop owner etc...)
2) Your duties & responsibilities and employers change on regular basis
3) You sales or services rendered vary daily/weekly
4) You provide your own hardware/ tools/ software and charge the client accordingly.

Now having identified what accounts for self-employed and what's not. As I said I have received the PNP nomination. There are additional documentation / details that I had to submit to CIC/PNP in my case. If applicable in your case you would need to submit the same.
1) Certification of Incorporation - show's when the company was registered
2) Certification of Ownership - shows who the owner of the company is
3) Certification of Compliance - shows current company ACTIVE status and if taxes are paid
4) Tax receipts/filing status
5) Letter from agency & employer - shows a link that I am hired by the agency but work for the employer.
Letter from the agency : Mentions that my contract is from such and such date and my company name and also mentions that my roles & responsibilities are defined by the 3rd party employer XYZ and mentions hourly rate and biweekly payment schedule

letter from the Employer : mentions all the relevant details, such as start-date, end-date, agency name, roles & responsibilities , signed by my reporting manager, HR manager ... etc (incase I have missed anything please add)

I totally disagree with you. I am in the same shoes as your 2nd job. I'm a contractor working for a third party via an agency, incorporated, fixed working hours ie I work 9-5, daily paid rate, my duties, responsibilities and services rendered have been fixed for the past 3 years, I work on site and my employer provides all the equipment but I am definitely self employed! I obtained reference letter from my agency who's considered my client and applied ticking the self-employed box, submitted tax returns, payslips, certificate of Incorporation etc. I've gotten my PPR so you are/were definitely self-employed.

 

[yengyeng]

Hi Dilbert,


Sorry, I should have included the following questions as well. Your answers do not give me enough information to assess your employment category.

Are you working fixed hours? Ex: 9-5 or are you usually on call and report to work whenever ? I work 8 - 5 pm daily, annual salary is fixed. I report to work whenever but i've been working 8 - 5 most of the time.
Do you work at the company on-site or you work from home ? I work onsite.
Does your company provide you with any hardware/software assets for your work or do you bring your own ? They provide everything i need.
Does your hourly rate change frequently ? Hourly rate is fixed. For example $30 per hour.
Contractor is a general description. Which field are you working in. What is your NOC category ? I'm working in the Sales Dept. NOC 6221.
You mentioned you have been working for 10 months and you still don't have a Business Number yet ? Are you paid cash/ cheque ? is the HST included in your pay ? I have a business number. Sorry if i didn't mention that. I am paid by the invoice i issue at the end of the month. GST is also included in my pay.

 

[Skvach]

From what you have described, you are considered as Self-Employed. You cannot claim points in CRS if you come under the CEC criteria. The criteria that I defined in my first post is for CEC applicants only. For FSW the self-employed experience is counted, I am not sure about the required documentation.

can you give me some more information regarding your current status ? Your express entry profile, your score, what category you filed for , your NOC ...etc

Well, I'm going for FSW, got a PT from Ontario last week. 441 points and 0621 = clothing store manager

 

[canadavisa1525]

I totally disagree with you. I am in the same shoes as your 2nd job. I'm a contractor working for a third party via an agency, incorporated, fixed working hours ie I work 9-5, daily paid rate, my duties, responsibilities and services rendered have been fixed for the past 3 years, I work on site and my employer provides all the equipment but I am definitely self employed! I obtained reference letter from my agency who's considered my client and applied ticking the self-employed box, submitted tax returns, payslips, certificate of Incorporation etc. I've gotten my PPR so you are/were definitely self-employed.

hello Could you please see my earlier post and reply
one more question you was self employed before getting PR or after

 

[Anya654]

hello Could you please see my earlier post and reply
one more question you was self employed before getting PR or after

When I got PR. It's the only work experience I used to get the PR ie applying as self-employed.

 

[Anya654]

Hello,

I am newbie to this forum let me explain my situation :

Me and my wife : She is primary applicant and I am dependent.We already had received ITA under fsw inland in july. She work full time on payroll for last 2 year.Me also use to work on payroll for last 2 year but in April I got the contract job and open incorporation but before that I already worked for more then 2 year on payroll.

Now I am dependent does this will effect my application as I am not considering any points for contract job because as I receive 7 points for 2 years experience, contract job I am doing as an fixed third party in telecommunication with fixed pay, time, desk and all.

One more I have checked mark as self employed after April 2015, as i think still we need to let them know what you doing currently, but I have put that in work history even not considering points.

Pleaseeeeeee help me explain situation properly or i can go back to payroll.

Thanks,


FSW inland
17th July
AOR Aug 21st
RCMp received
wife principal applicant working on payroll
dependent me use to work for more then 2 year on payroll but switch to Contract in April
Ecas in process 6 line

Since you didn't claim points as self-employed do not add it to your work history, instead add it to your personal history so you don't have to show proof for it. However make sure the 2 years payroll job you got your points for was exactly 2 years or more. Goodluck!

 

[Dilbert]

I totally disagree with you. I am in the same shoes as your 2nd job. I'm a contractor working for a third party via an agency, incorporated, fixed working hours ie I work 9-5, daily paid rate, my duties, responsibilities and services rendered have been fixed for the past 3 years, I work on site and my employer provides all the equipment but I am definitely self employed! I obtained reference letter from my agency who's considered my client and applied ticking the self-employed box, submitted tax returns, payslips, certificate of Incorporation etc. I've gotten my PPR so you are/were definitely self-employed.

Anya,
Thanks for participating in the forum thread and sharing your experience. I only described my situation as a CEC applicant and from the document RC4110 (http://www.cra-arc.gc.ca/E/pub/tg/rc4110/README.html) it clearly identifies my status as NOT Self-Employed. I see that you are applying under the FSW category, not sure whether inland or outland, but it's great that you experience was counted for and you got the PPR request.

CIC clearly states on their website that FSW self-Employed experience is counted towards CRS, but there is no similar section for CEC applicants. Again, as I said it's a grey area and also depends highly on the NOC category. If you read the description for NOC 2171, even the HRSDC states on the site that in some cases IT consultants can be self-employed.

No one in this forum works for CIC and my intention is not to provide information to mislead or misrepresent other forum members. The information provided by me is solely for informational purpose based on personal experience.