We can start talking a little bit about employee versus independent contractor. There is a guide on the CRA website. It’s called CRA Guide RC 40 110 differentiates between employee versus independent contractor. It talks about control tools and equipment, subcontracting work, financial risk, responsibility for investment, opportunity for profit. This is a very useful guide. However, big caveat here. Recognize that this is a guy who used CRM. And I think one of the most important things to know and understand when it comes to employee versus independent contractor, whether you’re talking employment law or tax law, it’s not CRA or and employment standards inspector that makes the determination they may make an assessment, but ultimately the decision as to whether you are an employee or an independent contractor is made by a judge. Now, hopefully you’re able to resolve that issue with the inspector or the agent to ensure that they recognize you as an independent contractor. Well, before this ever needs to go to tax. And that’s one of the areas that we do our best to help resolve those issues as early as possible. And the best thing you can do is add some preventative measures so that you’re never being challenged by ICRA or employment standards.
As I said before, this is a useful document for understanding Sierra’s perspective, but it is a guide written by Sarah. And Ciara has one perspective. You and your accountant and your lawyer may have another perspective. Hopefully those two perspectives align. If they don’t, it’s up to a judge to make a determination as to who is correct. So this is, like I say, useful, but keep it in perspective that this is a secret. The other thing I like to talk about is what I call the secret Skippy information about. And it’s not a secret. It’s published on the Internet. We’ve got a let down here in the thick of it. Let me even see if I can share this. I’ll try to share in the chat panel later today before we wrap up. So you have access to that link. This is a link that’s specific to information technology, information technology consultants, and it like the guide of the employee versus independent contractor guy that we mentioned earlier. It does have facts that could be considered neutral and indicators that a worker is an employee. First of all, I’d just like to point out that even in the way it frames the conversation is a little bit biased because say you have facts that are neutral, basically not saying whether you’re an employee or an independent contractor or factors that indicate that you are an employee is inherently biased.
There should be factors that say your employer, factors that say you’re an independent contractor. They won’t actually say any factors that say you are an independent contractor. They only say point out the factors that are neutral. The important thing about this guide is it went into some specific things around the independent contracting community in information technology and recognized that some of the standard rules that CIA has been using in the past, which are very applicable in other industries, are definitely not applicable in the information technology world, where, for example, people have very restrictive rules for the purposes of security around bringing your own devices and those types of things. And they have recognized that the level of control that would be required in information technology environment is different from that of, say, a painter or an electrician or a plumber. So that’s the good news. The bad news on this is that you still really have to be careful and understanding the language that you use. We’ve got a couple of points here that for the average layman, might seem to be very similar to me. I recognize that they are actually very different points. One has a factor that’s considered neutral, they say, for security reasons. And because the nature of the work makes this necessary, the IT consult must provide their services at the parents place of business.
So that’s great that just because you’re working at your and the client for most of the term of the contract, they can say that that’s neutral, whereas in previous areas they might have considered that to be a factor where you’re an employee.
Now, further down in this document, they do say one of the indicators that a worker is and the employees that it requires that the employer requires the I.T. consultant to provide services, a place of business to allow the payer to monitor and provide direction as to how the work is done. And I think the key here is really understanding how important languages and it’s really this key area where it says to allow the pair to monitor, provide direction as to how the work is done.
So one of the big things that that case law ICRA and everyone looks at is the amount of control that is exerted over the independent contractor.
And as an independent contractor, your payer is allowed to exert control over the outcome, but they’re not allowed to exert control over the process. Sometimes it’s difficult for people to understand what I mean by that. So I always use the analogy of a pager. So if you hire a painter to come into your house, you would tell him what colors you wanted, what rooms you want to paint, and whether you want to be painted, whether you want the ceiling painted, etc., etc. So you determine the outcome. But you certainly wouldn’t tell him whether he’s going to cut the blinds with a brush or whether he’s going to take the lines or how he’s going to actually paint the room. And that’s the difference of controlling the outcome versus controlling the process. And I think the other thing, while we’re on this topic or pager’s another analogy I often talk about, is falls following rules and procedures of your own client, because one of the big questions he may ask and has asked and some of the services they’ve done is do abide by the policies and procedures of your workplace. This is a question that often trips people up because they may quickly answer. But yes, I do. You don’t have to be in my 9:00 to be it by 10:00 and whatever the case might be. And I think it’s important to understand as independent contractors that you don’t abide by the policies and procedures of your workplace. You have your own policies and procedures that mirror those of your client.
And just like if a preacher were to show up at your house at 3:00 in the morning to paint your house, he’d be fired. And just like that, you as an independent contractor, if you went to work at 3:00 in the. Instead of showing up at the four hours that are consistent with your client’s business, that you would be fired very quickly. So you have policies and procedures that do mirror those of your clients so that you can be an effective independent contractor. And this is really about making sure that you understand the areas that can you can effectively put your foot in your mouth and put yourself in hot water with spray and language and literature around this topic is very, very important, which is why it’s critical that you work with people who are knowledgeable and experienced in this issue. So make sure if you are preparing your taxes, that you’re working with an accountant who’s knowledgeable on the topic. If, God forbid, this has come to a reassessment and that’s gone to tax court, you’re working with a tax lawyer who knows and understands the issue, who has fought cases already and most importantly, has won cases already. And there are, like I say, lawyers and accountants who are very knowledgeable, always happy to give a referral for anyone who has any questions about that. Now, we’re going to jump into personal service business first and first. I’m going to start with a definition of personal service business with personal service.
Business risk is different from employee versus independent contractor. First of all, the reason it’s different is because a personal service business is a type of legal entity. It is a type of corporation employee versus in the independent contractor can be applied against someone who is working through a corporation or someone who is working as a sole proprietor. One of the misconceptions out there was that if you work as a sole proprietor, you could not be assessed as a personal service corporation or personal service business. Technically true, because a sole proprietor is not an incorporated entity. So that can be a personal service business. However, it can be deemed to be an employee and it can lose all the ability to deduct expenses and be dealing with interest and penalties. And just as punitive as a person or very much like a personal service business. So this definition comes from the Income Tax Act, and I’m not going to read the whole thing for you guys right here because I’m pretty sure you can all read. Many might have even read it already. But I think that the most important thing is this paragraph that says a person or a partnership to whom or which the services were provided, but for the existence of the corporation could be reasonably regarded as I’m not even reading, I’m just going to say got lost, could be reasonably regarded as an employee of the corporation of the paper.
There are some exceptions here which talks about whether they had more than five employees. And we’ll talk a little bit about that. Unfortunately, the reality is very few independent contractors have five or more full time employees, which makes that aspect of a way of skirting around the issue null and void. And like I say, if you adequately protect yourself and you do a little bit of foresight and planning, you really shouldn’t be at risk of being deemed as a personal service business. We’re talking a little bit about.
The risk here, once a computer catches up to you.
Now, the current climate for CPAC is actually pretty good outside of this Bill 140 situation, at least compared to past present at one point. And it was arguably the biggest threat facing incorporated independent consultants. Are IT consultants? The CIA was looking for pieces of personal service businesses where they could prove that a contractor is not a true independent business. They did a special project out of that special project. They reassessed a number of individuals and then went after them for interest and penalties. Now, the impact for these individuals was quite high because what happens when you are reassessed is they’re going to deny the majority of your expenses. They’re going to then say that any money left inside the corporation is not eligible for the small business tax rate and is taxed at a much higher rate. And they’re going to look at a multitude of years and they’re going to reassess interest and penalties. So it’s not uncommon for reassessments to be in the tens, if not hundreds of thousands of dollars when someone is assessed as a personal service business. So the impact to the individual is is quite high. However, when you look statistically at how many people have been deemed to be personal service businesses, the risk is actually quite low. It’s a very small percentage of the population, even when they get a special project. We were talking about hundreds of people, not thousands of people that were reassessed. And even within that, Vaki did a lot of work to help defend a number of these cases. And in fact, the lawyers that work on the AKB cases fought and won every single case that they defended.
Now, unfortunately, many of those cases in that special project were what they call a consent judgment, which basically means that they didn’t go to court. They’re effectively settled out of court, which means that there’s no jurisprudence that other accountants and other lawyers can look to and say, look, here’s proof why these independent contractors are not personal service businesses and they use tools like our tax foresight and employment foresight tools that we use to be able to assess and unfortunately, a little bit like a bully. Sometimes they fight the cases that they know they can win and they settle the cases that they don’t believe they can win. So historically, a lot of cases around personal service business at taxpayer levels were often lost by independent contractors. Were starting to turn that around. We’re starting to get some momentum where we’re winning at the early stages. But even those cases that were won at one level were often then later overturned in appeals. And there’s been great success record. We’ll talk more about our proprietary document that goes through all the different case law and points out why our clients are not independent contractors, as well as the new tax for employment, for site tools that we use to search the entire database to point to other cases similar to the situation that you might be facing that show, why you’re not an independent contractor, because that is really a lot of what the course is based on decisions on his previous preexisting cases or jurisprudent.
So big point about personal service business and what that is. The impact on the individual can be quite high, but the risk is still relatively low. And the analogy that I’ve used many times and people have heard it, if you’ve ever heard the talk before, you said that personal service business is much like a shark attack. When it impacts someone, it’s vicious, it’s atrocious. But the amount of people that have impacts is quite small. And we shouldn’t let the news and the impact that we hear in media deter us from enjoying the bounties of independent contracting or the beauty of the ocean. So I think that there’s a very great analogy there to help you recognize that, yes, you should do some planning, some foresight so that you’re not taking unnecessary risks, that there’s a sign on the beach that says beware of sharks. Maybe it’s not the time to go swimming. Just like in the independent contracting world. If you’re doing things that are putting yourself at risk, you should either look at changing your situation or maybe even taking on a new role. So, again, happy to talk more about that as we go. I’d like to also give you some background on PFC. The first sort of landmark cases are the Wehbe door and the saddest case, and I think that the four major criteria that are still used today came out of the Wehbe door case back in 1986. So this is not a new issue. And even the stuff that we’re talking about here is definitely a tax issue, not an employment law issue.
But even employment lawyers looking at at the same sort of areas of control. And that’s degree of supervision and control, which we talked about earlier, is an important aspect of ownership of tools. Now, this is an area that’s still used today. However, it’s important to know and understand that the tools an independent contractor has unnecessarily his computer that he’s using. But it’s often considered most court cases to be the knowledge that you’re bringing to the table. So still an important part and still used today, just not maybe in the way that you might think the risk for profit and loss is a very important issue that is still used today, as is integral part of the process. And we’re going to talk about, again, some of that, some of the tools that we can use to help mitigate your risk, others at risk for profit or loss. One of the great things that I’m going to get a couple of times today is insurance. If you have insurance, the definition of insurance is your insurance against a risk. So we think that goes a long way for demonstrating that there is a risk for profit or loss. Now, we talked a lot about personal service business, which is, as we said, going back to the 80s, it’s not a new issue. What is new is No. One for you. And most people have heard of Bill one forty eight, but not because of employee versus independent contractor. They’ve heard of it around minimum wage, got a lot of publicity around its changes to minimum wage.
What bill. One forty eight was or was a change to the Employment Standards Act and Labor Relations Act and and labor relations are. The reason that it has had an impact on the independent contracting community is that there are some clauses in there that do affect the independent contractor market. Most importantly, we’ve got Section five point one one which says an employer shall not trade for the purposes of this, that a person who is an employee of the employer as if the person were not an employee under the act. So this is talking about employee versus independent contractor. In addition to this, they’ve actually put some teeth into the penalties for the employers. And so the penalties are up to fifty thousand dollars per independent contractor who is wrongfully deemed to be an independent contractor that the SSA investigator has deemed to be an employee. Now, this is going back to November of last year when the one for eight while Ascencion. So it’s been around for a while now. Anecdotally, we’ve seen a pause. I’ve seen a bit of a pause in the market. I don’t know if any of the agencies have seen this. There was a period of time where I know a lot of agencies were reaching out to be trying to figure out how they were going to deal with this impact. Our bill one forty eight and what it meant for their existing contractors that they had on market and on market and new contractors that they had.
And I think that basically the result in what most agencies have chosen to do is to do an assessment of every one of their independent contractors to determine their reasonableness. Now, this has been something that’s been used in the states before. Now, unfortunately, the states has gone gone the other way. That’s basically virtually eliminated the independent contracting environment, which is a shame because independent contracting is a necessity for businesses, the contingent workforce.
There’s a lot of reasons that that’s important. I’m not going to get up on a soapbox today and talk about why it’s important.
But one of the things that we’re having to do right now to ensure that you can continue to work as an independent contractor is go through an assessment so that you can demonstrate to the employer, you can demonstrate to the agency that you’re going with, that you truly are independent, because if if the agencies don’t feel comfortable that you are an independent contractor, that they can demonstrate and prove that you’re not in their contract, that they just not can place you, they’re not going to hire. So this while the penalties are being assessed and levied on the employers and the agencies, it is still very much an issue for the independent contractors themselves. And it is important for you to go out and be able to demonstrate that you are an independent contractor. So this is as important as your resume. My opinion is having documentation to demonstrate that you are an independent contractor. And what we’ve gone through, as we’ve done a lot of work to prepare tools for our client base and for recruiters that we work with to be able to provide that confidence so they can know that they can place you as an independent contractor with confidence.
So let’s talk a little bit about some of the things that we’re doing to minimize risk around personal service business, and then we’ll talk a little bit also about what we’re doing to minimize risk around employee versus employment law employee versus independent contractor on the bill. One forty eight or s.A. Side of things. So obviously, we’ve been dealing with this for a very long time, and since nineteen eighty four, we’ve been working on this issue. We were one of the first accounting firms to believe that independent contractors could incorporate and take advantage of the small business deduction. So we’ve been we’ve been dealing with this for a very long time. And back in the 80s, many of the other accounting firms were actually turning away these independent contractors and believing that they they weren’t eligible for the small business and couldn’t make use of that today. It’s a it’s a strategy used by the big four firms, by accountants all across the country.
It is an accepted strategy, however, and is still important to make sure that we’re not walking away thinking we’re we’re getting away with a wink and a nod to cheat the system. It’s important to make sure that if you’re working as an independent contractor, you understand what makes you an independent contractor so that if you are ever challenged, you can stand up for your rights and defend that. And you need to look and act like a business. So it’s not just enough to look like a business. You do truly need to act like a business if you want to be treated. But as I said, we’ve been doing this for decades now and we’ve fought and won all of our major cases. We have never actually lost a case in our history of dealing with this again. It is one to recognize, though, that it is still the impact is huge. The number of cases are small. We’ve dealt with, I would say probably.
Tends to hundreds of these cases over the 30 years. It’s still a very small percentage of the number of audits that are out there and it’s very, very small percentage of the entire market. So you don’t have to be afraid. Things that you can do to ensure your autopsy is, as we said earlier, you can have more than five employees. This is a funny little clause that came out of one particular case, which was, I believe it was in Oregon. I was a CFL player who was using a small business deduction to shelter and reduce his income. He had on salary himself, his wife and his two kids out of that case.
They said, well, if you have, you have to have more than five employees, somewhat random and subjective.
I don’t know very many true businesses that start day one with five full time employees, let alone any independent contractors. There are some strategies out West that are used by people are not willing to comment on whether how effective those are, not to amalgamate many its contractors into actively a consortium and use this as a tool to bypass that. My personal thought is that is overkill. Like I said, we have very, very good track record defending our clients, using traditional strategies. In addition, I in my experience in dealing with Syria is just like in that original case where they shut down a loophole by basically saying, well, you have to have more than five employees.
I think they will just come back and shut down this loophole once it gains enough momentum. So I don’t think that’s a long term solution. Now, that’s just my own thoughts on it. I’m not saying that that’s reality here. There’s a published information on it. That’s just my gut feel based on my experience with what I’ve seen here in the past.
So specific, measurable things that you can do to help minimize personal service business risk is make sure that you have a strong and clearly worded written contract. This is far more important on personal service business side, that it is on employment side, but still used on both sides of the table. It really is important to make sure that the work relationship contract must support the contract.
Again, many times when we talk about work, relationship and product, this this really is more about the language than actually what you’re doing and making sure that you’re using the right language and that you’re understanding, like, for example, that you have your own policies and procedures, not that you have not you abide by the policies, procedures of your limiting contract length is is definitely a good tool for demonstrating that there’s risk for profit or loss.
An important thing to know and understand is that no one case has ever been won or lost based on tenure. And again, with personal service, business and employment, they’re looking at all the factors combined. There’s no one individual factor that makes you happy or not. A piece of what we talked about earlier, which is the idea of having more than five full time employees. Another great thing that you can do is to diversify your client base. Sometimes that’s easier said than done.
Again, important to know and understand that if you have a few small clients and one major client, the CRM will again sort of look through that and say, and potentially assessors, maybe it’s still being an employee of that one major fight, even if you do have other small clients. So what we mean by diversifying our firebases is more of an equal balance amongst multiple things. You might have one larger client, but it’s not you’re not dependent on employment asset protection strategies. So there’s a number of charges that we use here. One of the most common is setting up holding companies. And these are ways to ensure that if you want to ever reassessed and lose your cases, God forbid that the assets and the wealth that you’ve accumulated over time are protected and sheltered. And there are ways to do that. We talked a bit about controlling your work and the process. Again, we talked earlier about the idea of control of the outcome versus control of the work. It is important that you were controlling your work, but that’s an important factor. Again, we talked earlier about the importance of liability insurance because this demonstrates risk for profit and loss again. So that is really important. The other thing that we’re seeing is more and more important on both sides of the table.
Again, the point of law versus tax law is having that professional profile. And it’s actually an area you can really get hung out to dry, because if you have a LinkedIn profile that’s saying that you are a project manager and X, Y, Z Corporation, rather than an independent contractor who is doing project management X, Y, Z contract. And that’s why the company you’re in effect putting yourself at risk. So you want to make sure that your business presence represents you as an independent contractor that includes your social media channels. Ideally, you should have a website that even if it’s just a professional profile website, you should have a website that demonstrates the services that you provide as an independent contractor. We also strongly, strongly believe that your company’s name should reflect your services, even if it’s Andrew Wall Consulting. That’s far better than a number of companies. All of our incorporation packages do include a name search, so it’s built into the pricing for everyone. We do don’t be penny wise and pound foolish and use a number of company. In addition, one of the things sometimes people are concerned about wanting to do multiple lines of business. Maybe they want to do some consulting and they also want to sell some products online. You can actually set up a different operating room so you can have multiple operating rooms, multiple bank accounts for the same corporation.
So don’t let that be an excuse to use a number of companies, not a number of companies at all, because businesses don’t do business with no companies that do business with other businesses. And lastly, probably most importantly, hire experienced professionals to represent you in. One of the most notable cases was a case called the Gomez case was actually a guy who worked at CRM. But interesting fact here is that CRM is one of the largest employers of independent contractors in Canada. So that’s an interesting thought. But he was an independent contractor at ICRA. He was assessed as a personal service business. He chose to represent himself. I’m pretty sure you can guess what the outcome of that case was, he lost that case. I’m not aware as to whether it’s actually come through appeals yet, but he lost also at the tax court levels. And again, if you don’t have the knowledge, if you don’t have the experience, it’s really easy to trip over your own feet, see things unintentionally that will deem you to be a personal service business or an employee. So make sure that you’re dealing with a knowledgeable representative and you’re getting sound advice from people with experience.
So one last thing before going to head is some of the unique tools that we we do offer our client base.
So as we mentioned earlier, we’ve got on a representation protection so that if you are assessed, we’re here to represent you. No additional cost to you to know that you have that knowledgeable resource available to you. And it’s not going to cost you a normal life to defend this issue. We also have a proprietary seventy six page response to Sciarra that outlines all the case history that we’ve seen in the past in favor of independent contracting. And we thought that on the best, the most serious auditors and in many situations that in and of itself is enough to send them away, confident that our clients are not personal service businesses. We also got a sample response to the questionnaire that was put out by that special project that went on a few years back. We’ve also now got a new tax for site, a deployment for site tool that allows us to use artificial intelligence to search tax and legal libraries for similar court cases to tell you and give you a percentage chance of probability that we think we will win, as well as all the court cases, of course, that are specifically relevant.
It also gives you some some sample questions what would happen and allows you to do some of the orders I’m looking for here. Some variance analysis, I guess, is what I’m looking for to test what are the areas where you’re at risk so that you can know if you change this one thing you’ve got now, you’ve got an 80 percent chance of being assessed as an independent contractor instead of a fifty four percent chance of winning that case. So it is a very useful, very powerful tool. Cost us a couple of bucks to get it. And we are offering that service to the community for free because we think it’s so important that people have the information that they have to know that they are free from that risk, whether it’s just for peace of mind for themselves, that they can sleep at night, not worry about Syria, come knocking on the door, or if it’s to help them make sure that they can get and keep that next contract with their employer because they’ve been able to make their employees and the agency feel confident they are truly working with an independent contractor. We are also working with a few agencies right now as an independent third party to help them go through this risk assessment to again back on their existing client database to make sure that they are truly independent. If you are an agency and you’re interested in doing a program like that again, please do feel free to reach out to me.
So minimizing risk around s.A again, it’s very similar to the tax law, they’re looking at the control test, they’re looking at at the ownership of tools that they’re looking at the chance of profit or loss. They’re looking at the integration test. But a few other areas that are important are also the details of the contract the business presents and the contractor contract for three areas in employment law that are treated a little bit differently than they are in the tax law. And it’s important to know and understand that historically we’ve been very successful on the tax side. The employment law side has been a little bit more stringent. They tend to air more in favor. There’s more cases where people are deemed to be employees than there are where they’re deemed to be independent contractors. That’s different in tax law. We’ve actually been able to win more cases to show that people are independent contractors than they’ve been able to where showing that their personal service businesses or employees. So that’s important to know and understand that this is why no one party is so critical and so important, because it can have very dire impacts on the independent contracting community as a whole. So we want to make sure that the agencies, the clients and the and the independent contractors all feel safe and comfortable to continue working as independent contractors and to continue to enable this contingent workforce, which is so important for our Canadian home.
So, again, some of the ways that you can maintain that contractor status when it comes to intent is that contract for independence. It’s around those control issues and making sure that you understand the language of what constitutes control and that the employer is controlling the outcome, not the process. Having a business presence. Make sure that you’ve got that website, the risk for profit or loss, and then making sure that you have you’ve got insurance to help demonstrate that there is a risk for profit and loss again, if we can get the contract. That’s important, too. The other thing that we also always say is don’t let the tax tail like a dog or in this case, maybe go on for a tail wagging dog and you’ve got great opportunities and great contracts that are longer than six months. It doesn’t mean you should turn those down. It just means that you might want to be stronger in other areas. Because when judges, when inspectors, when agents look at your situation, they are looking at the cumulative effect, not one particular issue. As I’ve said earlier, there’s not one item that we talk about today that in and of itself can be used to determine you as a personal service business or an employee. It is the sum of the whole.
So get a little bit about our new reasonableness, assessment, our foresight to Elizabeth Folgate, we are providing to all of our own clients we are in the process of rolling out now. We are also making it available to all members. It’s also available for all attendees of this webinar. As I said earlier, there is currently no charge for this program. We are rolling it out as a way to help protect the industry.
We are looking at maybe tailoring this program a little bit to see if we can add in some guarantees if we are able to do that.
The reality is there will be some significant cost for us to be able to generate those guarantees. And with that will be that we will probably turn this from a free program into a paid program. So get it while top people and log in, get your assessment and go through that. One of the important things is to note is that we have changed our assessment now three times. So we first in our assessment, we were, I think, the first people to launch an assessment tool with the help of a number of agencies who provide us feedback and input and assessment tools that have been used in the states. And we built off of that. So in order and then after we had the presentation from Hick’s Mallie at the next meeting, we revised again to use the SMALLY one, which I think is very good. Unfortunately, it doesn’t use artificial intelligence to be able to search the databases. In addition, the feedback that we got on the morally one, which was very thorough, was that the independent contractors, many of them felt it was invasive. We were asking for a lot of information to be provided to us, copies of contract, copies of articles of incorporation, copies of insurance, basically a whole slew of information. This new assessment tool is not asking for nearly as much information we can dive into, into what the assessment tool looks like.
I do have it open and Google.
This is this is what it is here. So we’ve got a number of questions. There are six sections we’ve got about this first section as well.
One, two, three, four, five, six, seven questions. So I think it’s no more than 30 questions to go through. We are not asked to provide any additional information. Again, when we look at the outcome of this, and it’s important to note that this like right now that I’m sharing here is a link to the important forsight tool, which is the tool we’re using for the one forty eight. We do also have a tax for site tool, which we are using for personal service. Business questions are similar, but they are different. If you want to see, make sure that you use the platform for not to want to use that. Also just show you in case you’re wondering how to find the ones for tax where you can find those. So for those of you are familiar with our website, it’s KPA for it. Doxa this has recently changed the old domain with seei for it dossie. We’ve got a new website here and in fact we’ve got a whole new company to be honest, because Sears no longer exists. CPAs are the new designation of choice. In addition, as many of you know, my father founded the original organization. I’m now taking over at the CPA for I.T. is the new structure where we’re doing this.
So under our resources section here you will find links to a number of the tools that we offer free to our client base. So we’ve got a pyramid of power which frequently asked questions. Our personal service, business risk assessment, the employee versus independent contractor. That’s what we’ve also got some guides out here about cloud accounting.
So lots of great information available on our website. Please do check it out. Give us your feedback if we can make it better. We’re always looking to constantly and demographically improve. So please do give something back on these tools and let us know how we can improve. And we can make your life easier as independent contractors in your life, easier as agencies that we do have about nine minutes left. I will again close by just saying that good advice is priceless. Reiterating the point that you work with a professional that’s experienced someone who takes the time to educate you, to ask the right questions and most importantly. That you can understand, these are complicated issues. We do our best to express them in simple terms as possible, but make sure it’s still got enough technical information around. And again, we can always do better to get feedback on how we can make this presentation more impactful, more useful for the community. Please, please, please do share your feedback with us. We really do appreciate it. And if you need a referral for a lawyer, we’re happy to make it a referral for county. We’re probably going to refer ourselves. But again, if we’re not able to help you or serve you for whatever reason, I actually have built up quite a large network of other kinds of bookkeepers, not only in Canada, but in Canada, the United States, Australia and the UK, through my experience in the Provisor network within it.
So always having to make a referral for not the right fit and happy to help in any way. Now, what I’m going to do is I’m going to open it up, like I say, for questions. I will ask if you’ve got questions that you use, either the Q&A or the chat section to post your questions and I’ll leave it up. We’ve got, like I say, about another eight minutes and I want a tab on here, but we’ll leave it open for about another eight minutes with some. No questions. Some thoughts. Questions. I always get nervous when there’s no questions, that means I’ve either done an outstanding job or I’ve done a really bad job. Hopefully it’s just technical issues. People aren’t sure how to pose their questions because I still see a lot of your still down then. So 11 participants on the call right now, however, will not go through any questions.
Just a few more minutes in case people are still trying to figure out if you feel confident, you’ve got all the answers, great.
If you would rather ask these questions at another time, I’ll fly again.
You get our contact information up here.
So you can find us online at CPA for it and you can reach us at our toll free number at one 800 four six five seven five three two. The e-mail address for the organization is customer service at KPA for it. Oh, we do have some Q&A. Look at this and it will be resolved. So we’ve got three questions here. So bear with us and we’re going to start with Pat. Could you explain what a PSP is? Again, I’m still a little confused.
So a personal service business is a type of corporation that Craig has said, but for the corporation could be reasonably regarded as an employee of your major client. And so this is basically they’re saying that you’re working as a corporation, but they don’t believe that you are truly an independent contractor. They think that you’re acting more in the way of an employee. So get similar to employee versus independent contractor, just specific to corporations. It is a type of legal structure. So in the past, one of the things is a corporation for a period of time before going back to the 90s. Now, if you incorporated that was the case, what’s your equivalent? You’re pretty much left alone. That went away when they came around. He’s basically said, even if you’re incorporated, you could still be deemed effectively an employee. Now, you’re not deemed an employee, but basically what they do is they deny all your expenses. And they say that the personal service business has a what I call a punitive tax rate. It’s it’s a substantially higher tax rate than the small business, which actually is worse than if all that income were considered. That is employment income. So that is hopefully I’ve answered your question, so please do let me know if I’ve answered the question.
Can you download the presentation? I’m assuming you mean the PowerPoint gap. Yeah, we’ll make it available for you down here.
So we will make the PowerPoint available for you, if that’s what you’re looking for. This session has also been recorded in the past. The reality is with me, the way I talk, I don’t I’m not scripted, as you can probably tell by the names. And so we have done the session last. Very similar ones. They’re recorded. They’re often social media because we stream them love Facebook. So check out our Facebook page to find copies of the video. If you want that we use that, we will probably I have been recording the session. I’ll probably put it up to YouTube as well, although we did it streamed live over Social today and glad to hear I answered. I guess that was the third question was thanks so you and you’re most welcome. So I think we’ve gotten to those two questions that we’ve got. Again, please, if you’ve got more questions.
Can I recommend a good way to create a contract? So my number one recommendation for a contract is going through an agency.
The advantage of going to an agency is they have contracts that have been vetted by lawyers and accountants to ensure that they’re minimizing risk for a number of factors. One of the other things is the A.P. has available to its members a sample contract that we could probably download for you. It’s again, intended to be through staffing agencies or may not be the I wouldn’t use that verbatim, but it might be a good place to to start as a starting point. I would say that the most important thing is that if you are going to be doing it, you’re going to be doing your contract yourself. You really should invest the money to have it reviewed by a lawyer and an accountant to make sure the lawyer is going to make sure there’s no legal issues. And an accountant can look to see if there’s any personal service, business issues or tax issues, or you could get a tax lawyer to try to do both.
That might also work, but make sure that you’re seeking out a professional.
So hopefully that does not answer your question again.
See?
So we’ve got another question here, so I didn’t answer that question, which is great, if you don’t have access to Facebook, it’s a way for you to get a copy or download. Assuming you’re talking about the video, we will all make sure. I’ll ask my colleague to send a link to the PowerPoint that I’ll put it up on SlideShare and I will send a link to the attendees without a copy of the slide back to the attendees. Now, if you’re talking specifically about the video, if you don’t have Facebook, it is also available on YouTube as well.
So check our YouTube channel.
Just Google or just YouTube KPA for it and we should come up again. I will ask my colleague to try and include a link to one of the prerecorded sessions that we’ll we’ll do a follow up email to all the attendees with links to the survey and links to previous recordings and links to the slide back.
And any other questions?
It looks like we’re literally like almost to the minute on time, so thank you guys for taking the time out of your lunch, taking your lunch break with me again. Please, please, please do share your feedback. We’d love to hear how we’re doing. If you found this useful again, you’re valuable.
We’d love to hear positive Google reviews, those called long wait for helping our social media so we can always use help on that aspect and of course, reach out every time. So thanks, everyone, for the.
That we were able to help out that I’m great one I for now.
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