Income Tax - Employee vs Contractor (OC)

Detailed information on the difference in the designation of individuals as contractors vs. employees for tax purposes from both the corporate and individual perspectives.

OBJECTIVE:
The seminar provides participants with an understanding of CRA’s evaluation criteria for employee vs. contractor status as well as understand the tax effects to the designation of employee vs. contractor from both the corporate and individual perspective.  Discussion on the taxation of personal service business income will be included.  

This half-day seminar provides detailed information on the difference in the designation of individuals as contractors vs. employees for tax purposes from both the corporate and individual perspectives. 

Tax rates, CRA guidelines and considerations as well as case law examples will be covered and then case studies will be used to allow for participant application. Case study examples will illustrate a variety of situations from both perspectives so that practitioners can obtain a working knowledge to make appropriate considerations and documentation in determining the appropriate designation as well as calculate and apply tax principles for tax planning in various scenarios.

Case study examples will cover unincorporated contractor, incorporated contractor and employee situations to compare and contrast the tax effects for each of the corporation and employee.  The advantages and disadvantages to each type of set-up will be discussed and evaluated as well as the risks to making this distinction.

WHO WILL BENEFIT:
Practitioners working with individual and corporate clients, assisting them with corporate set-up and tax planning.

LEARNING OUTCOMES:
By the end of this seminar, participants will be able to: 

  • understand the different tax effects and considerations to being an incorporated / unincorporated contractor vs. an employee,
  • understand the penalties at risk for individuals and corporations in choosing contractor vs. employee,
  • understand and apply tax rates to businesses earning personal service business income vs small business income and to employees or contractors personally vs flow-through from the corporation to understand the tax
  • effects of the potential set-ups, 
  • apply tax principles to determine employee vs. contractor status, and
  • apply tax principles to determine net effect of correctly or incorrectly choosing either status (benefit vs. risk).

CONTENT:

  •  Definitions, types, important facts about employee vs contractor and incorporated vs unincorporated
  • Taxation rates and considerations (including GST) from the corporate perspective
  • Taxation rates and considerations (including GST) from the individual perspective
  • Case law and CRA rulings relevant to employee vs. contractor designation
  • Case study looking at situations for corporations looking at a variety of set-ups to determine balance of factors indicating one designation vs. another and tax effects to both situations (including potential penalties if CRA rules the opposite)
  • Case Study looking at situations for individuals looking at a variety of set-ups to determine balance of factors indicating one designation vs. another and tax effects to both situations (including potential penalties if CRA rules the opposite)
  • Take-away summary of concepts

PREREQUISITES:
Ideally practitioners would have at least one year of experience working in corporate and personal tax.

NOTE: Ideally, participants would have paper and a calculator available to work through examples as a group or computer with Microsoft Excel.  

COURSE LEADER: FRANK LAVITT, LL.B, B.Comm (Hons)

When
1/21/2022 1:00 PM - 4:30 PM
Canada Central Standard Time
Where
Online Course

Personal Passport Eligibility

Corporate Passport Eligibility

 

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