Vancouver CPA | What Makes Your Company Less Stressful?
Vancouver CPA says that yes contractors must be held to a certain standard when it comes to working for a small business.
What this means is this means that you have to be very careful and you have to be able to hire and retain contractors that are trustworthy, and ethical.
Be careful, as sometimes you will be able to retain a contractor for your business only to not realize that they are not incorporated. Unfortunately, in this scenario, that passes all the risk on to you. For example, what happens if somebody happens to get injured on the job. Again WCB will have a difficult time encumbering you because you will not be able to get the BC be number.
As well, you will likely not be able to get proper legal care as that person was not incorporated the time of potentially the injury or the other matter.
Often times what a lot of people will ask, says Vancouver CPA is able ask what is going on with this potential contractor? The only time a contractor that you should be able to work with, is in fact the incorporated contractor. In terms of the process of incorporation it is a simple matter of potentially only 24 hours. You can simple call a charter professional accountant over the phone, and they will be able to do it within a day. You potentially don’t even need to go to their office.
The psychology is very interesting entrepreneurs in that they feel that they may be good at influencing other people, including a legitimate government action. Contrary to popular belief however the Canada revenue agency has seen people to that effect time and again. And they do not let up or allow any freebies to anybody.
Consider as well the auditors that will not necessarily take care of the person as they do not know yet if they have other clients or not if in fact they are considered potentially under investigation with the Canada revenue agency because they feel as though these people are an employee of this company instead of a contractor, the list of interrogation questions are very lengthy, potentially about 50 of them, says Vancouver CPA. Some of the questions that can be asked is is the person insured do they have any other customers other than this particular business, etc.? Other questions are whose training them if any training is needed and all? How are the hours in the schedule set? Is it the owner of the company that is setting the schedule or is it the contractor?
This might be at a considerable risk you might know that you’re going to want to reduce the risk level of your company, but at the same time people from contractors to employees, something that comes with extra costs. As well, it we may not be very well received with the contractors, as they have been working as a contractor for years and don’t like change.
Clients should be very pragmatic with this scenario and in this case, says Vancouver CPA.
Big companies will potentially bring on Sunday as an employee and the CRA will in fact cheer as they are going to get their fair share of tax and it’s quite simple. That is ideally the Canada revenue agency’s job they are the tax faction of the government.
Other times what will happen is business owners will come in the series and they’ll say that they haven’t had any problems as they been in business for one year five years 10 years or even longer. However, just as in anything else, it will eventually catch up with them. Remember the old adage “the only two things constant in the world is death and taxes?” That will definitely ring true for a lot of these people that have dealt with employing contractors instead of employees.
There is also the psychology of the matter as well, says Vancouver CPA, entrepreneurs feel as they can get away with almost anything. However, that is sifting out the cased and the Canada revenue agency is certainly ready for people with big mouths and who think that they do not owe anything to anyone as they are ever so popular and arrogant.
They may in fact be making a very passionate very logical argument and then automatically assume that once there audit argument is done and their meeting is over that they are safe from the wrath of the Canada revenue agency. The problem is that anybody can make that same passionate, larger logical’s argument on both sides of the issue. For example, say for example some of these done their homework, and they been online and they read a couple of articles. About if you’re a contractor or an employee and potential now that you’re safe. If you make a great argument the ruling process is probably not going to go down the way with which you think it will. You feel as though you are going to be safe, on the other hand they are going to be able to catch up to you and you may be on the hook for tens of thousands if not hundreds of thousands of dollars in back taxes. These back taxes will come from CPP and employment insurance back taxes that you haven’t paid on behalf of those employees that you thought were contractors. That could devastate your business and could potentially bring you towards a bankruptcy.
You might know that you have a risk to your business, states Vancouver CPA, and you’re going to want to reduce that risk level, by the same time you need to be legitimately switching people from contractors to employees. Sometimes there can be a lot of extra costs to you and maybe some backlash and some troubled times in terms of morale with those people that you are going to be able to change over. Mention the fact that they should incorporate.