Steps

1. Review: Guide RC4110: Employee or self-employed

   It is important to determine if a worker is an employee or a self-employed. Employment status has direct impacts on your reporting and withholding requirements for the worker under the Canada Pension Plan (CPP), Employment Insurance Act (EIA) and the Income Tax Act (ITA).

2. Review: Worker who performs services on behalf of their own corporation (personal services business)

   If the worker is performing services through their own corporation, special rules may apply to their corporation for income tax purposes. Depending on the situation, if a worker performs services on behalf of their own corporation, the corporation may be considered to be carrying on a personal services business (PSB).