I recently received a package titled: “Contract Payment Reporting System” and instructions for filling in form T5018Summary -Summary of Contract Payments and T5018Slip – Statement of Contract Payments. We have to fill in an information slip for every sub we pay more than $500/year, including a Business number or SIN. With more than 500 subs, you are REQUIRED to submit on magnetic media.
The package comes with a little brochure titled: “Will you do it for cash ?” Looks like the Canadian government is taking square aim at the grey construction economy
Apparently this has been in effect since 1998 ?
Over the phone, I found out that this MAY apply to a homeowner who is building as his own GC too.
.
Phill Giles
The Unionville Woodwright
Unionville, Ontario
Phill Giles
The Unionville Woodwright
Unionville, Ontario
Replies
I just received the same package from our little friends in Ottawa.Haven't really looked it over.By the way, with what's going on in Ottawa with Adscam, they should be giving seminars on how to use the underground economy,seems they wrote the book!!!
I started out with nothing and I have most of it left.......
zounds like you all are finally getting as advanced as we are, maybe moreso. We get to make $600 before a 1099 slip happens.
And we all do it too.. You wouldn't ever skip out on any reporting things to the govmt now would you. I bet you are so glad you finally got this package!
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Actually, I don't - this is nickles and dimes compared to my pension and I have no intention of screwing that up..
Phill Giles
The Unionville Woodwright
Unionville, Ontario
Yeah, not new. One of the reasons why I don't run subs in the typical way is that paperwork and the complications....I always have two plumbers, two electricians etc. that I like to work with, and refer them to the homeowner if they don't have someone already lined up (at least two, so I'm not pushing anyone on the client). Client pays them directly, but I will coordinate them for the client if they want, as part of my arrangement with them. Or they have a GC, and it goes through that way. Works for me as I'm not a builder, do zero new construction work, and clients in this region seem to like it that way. I give up a markup, but that's not a big factor in my work ....and I lose some leverage, some times, with the other trades because I'm not paying them, but they're still mindful of future referrals etc.
If I was running subs, I'd be careful that paperwork was 100%....I've been told several times by Rev people that they they target different industries on a revolving basis, but construction is basically always under scrutiny. Don't know why you got a package, I haven't had anything specific....maybe you showed up on someone's radar screen.
cabinetmaker/college woodworking instructor. Cape Breton, N.S
I'm told the triggers were: Business Number (aka: GST number) and listing a construction trade on your 2004 return as your vocation..
Phill Giles
The Unionville Woodwright
Unionville, Ontario
Phill,
I also received the package. The sub-contractor reporting form was nothing new, but the pamphlet about cash work was. Don't know about everyone else here, but I found the threatening tone of the thing to be quite offensive.
I haven't got one. Maybe they're not going after remodelers this year?
Dinosaur
A day may come when the courage of men fails,when we forsake our friends and break all bonds of fellowship...
But it is not this day.
Know what you mean, one of my friends is now really worried that he's going to be in trouble because he paid cash for a roofing job..
Phill Giles
The Unionville Woodwright
Unionville, Ontario
There are many reasons why it's not worth it to work for cash. I seldom hire subs. But when I do, I pay above board - makes it easier if a legal dispute or warrantee issue comes up. I have been asked to do jobs for cash so the homeowner or GC can save the GST. But why should I risk getting in hot water with CCRA so THEY can save 7% - it's just not worth it. Not only that, but the people who play that game are probably going to be cheaping out all the way down the line (wanting freebies thrown in, etc.)I have enough to worry about as it is. At the end of the day, you're further ahead dealing with legitimate builders in a legitimate way. It's just good business.One more point. Working for cash, dodging CCRA and WCB only ends up de-valuing our work, making it more difficult to compete.
Yes, some of the guys around here claim to work for cash; but, they're really just doing a little discount to get a specific job without lowering their list price..
Phill Giles
The Unionville Woodwright
Unionville, Ontario