What does the CRA do with the information on the T1204?

The information indicated on the T1204 slip is used in a number of ways by the Canada Revenue Agency (CRA). First, it is matched with tax returns for that year to make sure that the subcontractor filed a tax return and declared, in gross terms, the amounts listed in the T1204 plus amounts listed in any other information slips received for that subcontractor. The information is also used for identification, compliance, audit programs, and statistical purposes.

The CRA identifies contractors who do not:

• file returns or report their full income;
• register for goods and services tax/harmonized sales tax (GST/HST); or
• report total sales and GST/HST remittances.

This is an important part of the CRA's strategy to combat the underground economy.

Date modified:

2016-12-15