Working under the table - Canadian law.
October 10, 2016 3:29 PM Subscribe
Hi; This is in Canada. When a employer hires u, and says u will be paid in cash once a month (no taxes), and it's up to u to pay your taxes - at the end of year, what happens to the employer - or u? How can the worker or employer get caught? Thanks :-)
You're a self-employed microbusiness and need to make your own payments not just at the end of year, but also monthly or quarterly, depending on the amounts in question and the kind of work.
Basically, if you're self-employed, the onus is on you to do proper basic small-business bookkeeping, including submitting taxes and employment insurance and whatever other provincial or federal levies Canada and your province require. You can't just wait until the end of the year and the file just like an employee.
That said, if they're treating you like an employee (setting your hours and place of work, signing no contract, providing your "tools" and so on) then they're legally obligated to actually employ you. Your local Labor Board (I think that is what it's called in Canada, I'm a long time removed from this stuff) or workers' rights agency will have details for you, and I am sure you can call or ask anonymously. There are circumstances in which the government could go after them for the missing payments, or go after you, or go after both. Might as well find out in advance.
Also, like: this is almost always fishy, and the odds are good they're not reporting that you exist or that you have been paid in any way, and they're expecting you'll pretend the income doesn't exist, either. Do some digging before you get entangled in a mess.
posted by rokusan at 4:09 PM on October 10, 2016 [1 favorite]
Basically, if you're self-employed, the onus is on you to do proper basic small-business bookkeeping, including submitting taxes and employment insurance and whatever other provincial or federal levies Canada and your province require. You can't just wait until the end of the year and the file just like an employee.
That said, if they're treating you like an employee (setting your hours and place of work, signing no contract, providing your "tools" and so on) then they're legally obligated to actually employ you. Your local Labor Board (I think that is what it's called in Canada, I'm a long time removed from this stuff) or workers' rights agency will have details for you, and I am sure you can call or ask anonymously. There are circumstances in which the government could go after them for the missing payments, or go after you, or go after both. Might as well find out in advance.
Also, like: this is almost always fishy, and the odds are good they're not reporting that you exist or that you have been paid in any way, and they're expecting you'll pretend the income doesn't exist, either. Do some digging before you get entangled in a mess.
posted by rokusan at 4:09 PM on October 10, 2016 [1 favorite]
If they aren't paying taxes, then you are an independent contractor. If you earn over $500, then they should file a T4A on what they paid you and report it to the gov. They should've asked for your SIN already.
posted by Monday at 5:44 PM on October 10, 2016 [1 favorite]
posted by Monday at 5:44 PM on October 10, 2016 [1 favorite]
The employer can get caught via an audit or a payroll audit (two different things); the employee can get caught if their financial situation doesn't add up -- if you have a very low income in a high income neighbourhood, or you have a car that costs more than you earn, or your bank records lots of interest income/RRSP/TFSA that doesn't seem to match up to your current income.
This will also mean that you are going to have CPP and EI issues.
posted by jeather at 6:28 PM on October 10, 2016 [2 favorites]
This will also mean that you are going to have CPP and EI issues.
posted by jeather at 6:28 PM on October 10, 2016 [2 favorites]
What does the contract you both signed say? If there is no contract, and they are paying you cash after you have worked a month (! Biweekly or Weekly is the norm) then I would assume you are going to work for a month and not get paid, or not get paid the full amount and have no recourse. Happens all the time.
If you don't want to call the Ministry of Labour you can always go into the local EI office and ask for help.
posted by saucysault at 5:33 AM on October 11, 2016 [1 favorite]
If you don't want to call the Ministry of Labour you can always go into the local EI office and ask for help.
posted by saucysault at 5:33 AM on October 11, 2016 [1 favorite]
Check out this CRA sight "Employee or Self-Employed?": Deciding a worker's employment status in a province or territory other than Quebec . It will tell you how CRA determines whether or not you are an employee or a self-employed individual.
posted by BozoBurgerBonanza at 1:42 PM on October 11, 2016
posted by BozoBurgerBonanza at 1:42 PM on October 11, 2016
CRA watches for things like the income you report and you will get dinged, not the employer.
Yes, you may get dinged, but check the site I mentioned above...An employer who fails to deduct the required CPP contributions or EI premiums has to pay both the employer's share and the employee's share of any contributions and premiums owing, plus penalties and interest.
posted by BozoBurgerBonanza at 1:47 PM on October 11, 2016
Yes, you may get dinged, but check the site I mentioned above...An employer who fails to deduct the required CPP contributions or EI premiums has to pay both the employer's share and the employee's share of any contributions and premiums owing, plus penalties and interest.
posted by BozoBurgerBonanza at 1:47 PM on October 11, 2016
« Older Cozy, nerdy fall book recommendations | What to get for my bosses at work that already... Newer »
This thread is closed to new comments.
posted by peppermind at 4:03 PM on October 10, 2016