How to Tell If You're an Employee or Self-Employed

Different tax rules apply to different types of workers. Tax return dates may vary, as do the types of forms to be submitted by workers and payers. Here's how the CRA defines whether you're an employee or self-employed.

Are you an employee or self-employed?

The worker-paying relationship determines the status if a worker is an employee or self-employed. Among other criteria, the CRA defines a self-employed individual as a worker who:

 
• Does their work independently and with minimal input from the payer
 
• Works without supervision and at the time of their choice
 
• Can supply services to multiple payers at the same time
 
• Is free to accept or decline work from payer
 
• Provides services to payers without employer-employee factors such as "continuity, loyalty, security, subordination, or integration."

The CRA also considers the ownership and control of tools and equipment. Whether property is leased or rented also affects rates, deductions and credits. Taxpayers are responsible for knowing which deductions to claim.  Revenu Quebec asks workers and payers to define their contract according to the Civil Code. A contract of employment (article 2085) means the worker agrees to carry out duties as directed by the employer. A contract of enterprise or for services entails no subordinate relationship between worker and payer (article 2099).

Some special situations for employment categories

This category of workers is subject to particular rules with regard to income tax, Canada Pension Plan, and Employment Insurance. They may be employees or self-employed. These special situations may include:

 
• Barbers and hairdressers
 
• Taxi drivers and other passenger-vehicle drivers
 
• Emergency services volunteers
 
• Temporary help services
 
• Caregiver, baby-sitter, or domestic worker
 
• Employees outside of Canada
 
• Fishers
 
• Placement and employment agency workers
 
• Seasonal agricultural workers
 
• Special or extra duty pay for police officers.