--- title: "Contractor Accounting: Guides, Tools and Checklists" url: https://www.everstonecpa.com/contractor-accounting-hub description: "Contractor accounting hub: guides, calculators and checklists for incorporated contractors, from incorporation and T5018 slips to vehicles. Start here." type: service-or-info updated: 2026-10-08 summary: "Incorporated contractors face a different set of tax questions than product businesses: personal services business risk, subcontractor reporting, equipment write-offs and vehicle records. This hub gathers the guides, calculators and service pages on those topics, each annotated so you can find the one that fits your situation." faq_count: 6 publisher: EverStone CPA Inc., a Chartered Professional Accountant firm registered with CPA British Columbia and CPA Alberta service_area: British Columbia, Alberta, Ontario and Manitoba language: en-CA contact: info@everstonecpa.com · https://www.everstonecpa.com/book-online --- [Home](https://www.everstonecpa.com/) [Resources](https://www.everstonecpa.com/resources) Contractor accounting hub Topic hub # Accounting for incorporated *contractors and trades* Updated 8 October 2026 The guides that matter when your corporation invoices for work rather than sells a product — classification risk, subcontractor reporting, equipment, vehicles and how you get paid. [Get My Fixed Quote](https://www.everstonecpa.com/book-online)[Ask a Free Question](https://www.everstonecpa.com/quick-question) **Quick answer:** Incorporated contractors face a different set of tax questions than product businesses: [personal services business](https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4012.html) risk, subcontractor reporting, equipment write-offs and vehicle records. This hub gathers the guides, calculators and service pages on those topics, each annotated so you can find the one that fits your situation. The four questions an incorporated contractor keeps meeting. An incorporated contractor faces genuinely different tax questions from other small companies. Whether CRA sees a real business or a disguised employee changes the rate on everything. Paying subcontractors brings reporting a retailer never sees. Equipment, trucks and tools dominate the balance sheet. And project billing brings cash in lumps that must fund remittances due on a fixed calendar. The guides below are grouped in that order — classification first, because it is the one that changes everything else, then the people you pay, then the assets you buy, then how money reaches you personally. ## Start here: the classification question - [Personal services business risk](https://www.everstonecpa.com/blog/personal-services-business-psb-risk-canada) — what happens when CRA decides your corporation is really an employee with a business number: the small business deduction disappears and most deductions go with it. Read this first if you have one dominant client. - [How CRA tells a contractor from an employee](https://www.everstonecpa.com/blog/employee-vs-contractor-cra-worker-classification) — the factors actually weighed, from the worker’s side of the relationship. Read it before signing a long engagement that looks like a job. - [Accounting for contractors](https://www.everstonecpa.com/contractor-accountant) — the service page: what an engagement covers for a contracting corporation and how the year runs. Read it if you are deciding what to outsource. ## The people you pay - [Subcontractor or employee, for a construction business](https://www.everstonecpa.com/blog/subcontractor-vs-employee-cra) — the same test applied from the hiring side, with the crew-based examples trades actually face. Read it before your first hire. - [T5018 subcontractor reporting](https://www.everstonecpa.com/blog/t5018-subcontractor-reporting-construction) — the construction-specific information return for payments to subcontractors, which surprises most first-time filers. Read it if construction activity is your main source of income. - [Choosing between hiring an employee and a contractor](https://www.everstonecpa.com/employee-vs-contractor-hiring-canada) — the commitments each model creates for the business doing the hiring. Read it while you are still deciding, not after the offer. - [Payroll services](https://www.everstonecpa.com/payroll-services-canada) — what running payroll properly involves once you decide someone belongs on it. Read it the month before the first pay run. ## Equipment, vehicles and tools - [Equipment and CCA classes](https://www.everstonecpa.com/blog/equipment-cca-classes-bc) — how tools, machinery and trailers are written off over time and which class each lands in. Read it before a major purchase, when the timing can still be chosen. - [Capital cost allowance, generally](https://www.everstonecpa.com/blog/capital-cost-allowance-cca-classes-canada) — the broader rules behind depreciation for tax, including what happens when you sell an asset. The companion to the guide above. - [Vehicle and mileage deductions](https://www.everstonecpa.com/blog/vehicle-mileage-deductions-canada-business) — the log CRA expects and how business use is actually substantiated. The single most commonly reduced claim on a contractor’s return. - [Company vehicle benefit calculator](https://www.everstonecpa.com/vehicle-benefit-calculator) — estimates the taxable benefit when the corporation owns the truck you also drive personally. Run it before putting a vehicle in the company. - [Company car taxable benefits explained](https://www.everstonecpa.com/blog/company-car-taxable-benefit-canada) — the standby charge and operating benefit behind that calculation, in plain terms. ## Getting paid, and keeping the books straight - [Salary vs dividends calculator](https://www.everstonecpa.com/salary-vs-dividends-calculator) — models both routes on your own numbers. Worth running every year, because the answer moves with your income and your CPP position. - [Salary vs dividends, in depth](https://www.everstonecpa.com/blog/salary-vs-dividends-2026) — the reasoning behind the calculator, including the non-tax consequences owners forget. Read it once, properly. - [CPP for incorporated owners](https://www.everstonecpa.com/blog/cpp-for-incorporated-business-owners-canada) — why taking dividends means opting out of CPP, and when that is a bad trade. Directly relevant to the choice above. - [Home office through a corporation](https://www.everstonecpa.com/blog/home-office-deduction-corporation-canada) — how the deduction works when the company, not you, is the taxpayer. Read it if the truck is your job site and the kitchen table is your office. - [Behind on your books?](https://www.everstonecpa.com/behind-on-bookkeeping) — for when several years of receipts are in a box and the filings are behind. Read it if that describes the situation honestly. ## If you are in the trades specifically - [Construction accounting in BC](https://www.everstonecpa.com/construction-accounting-bc) — holdbacks, progress billing and job costing, which general small business guidance tends to skip entirely. - [Accounting for owner-operators and truckers](https://www.everstonecpa.com/accountant-for-truckers) — the fuel, per diem and cross-border wrinkles specific to transport. Two adjacent hubs cover the rest of the calendar: [corporate tax](https://www.everstonecpa.com/corporate-tax-hub) for the T2 and its deadlines, and [GST/HST](https://www.everstonecpa.com/gst-hst-hub) for the sales tax on every invoice you issue. For the forward-looking side of a contracting business — backlog, working capital per job and bid margin discipline. See [fractional CFO support for Surrey construction and logistics companies](https://www.everstonecpa.com/cfo-services-surrey). About this page **EverStone CPA** Prepared and reviewed by a Chartered Professional Accountant at EverStone CPA, a CPA firm working fully online with small and midsized businesses in BC, Alberta, Ontario and Manitoba. [About the firm](https://www.everstonecpa.com/about) · [Send an enquiry](https://www.everstonecpa.com/book-online) Common questions ## Contractor accounting — common questions **What is a personal services business and why does it matter so much?** A personal services business is CRA’s label for a corporation that exists mainly to provide one person’s services to what would otherwise be their employer. The consequence is severe: the small business deduction is denied and most ordinary business deductions are disallowed, so the same revenue is taxed far more heavily. It is the single largest tax risk an incorporated contractor carries. [Ask about your case →](https://www.everstonecpa.com/quick-question) **Does having only one client automatically make me a personal services business?** No, but it is the factor that draws attention. The analysis looks at control over how the work is done, who supplies the tools, whether you can subcontract, whether you carry financial risk and whether you can profit from doing the job efficiently. A single client with genuine independence on those points is defensible; a single client who directs your hours is not. **Do I have to file T5018 slips for my subcontractors?** If construction is your primary business activity and you pay subcontractors for construction services, an information return is generally required for those payments. It is separate from payroll and separate from your T2, and missing it is a common first-year oversight for trades that have just started using other crews. **Should the corporation own my truck?** Corporate ownership depends on how much of the driving is genuinely business. Corporate ownership creates a taxable benefit for personal use, calculated on the cost of the vehicle and the kilometres driven, and for a truck used substantially outside work hours that benefit can outweigh the deduction. Model it before transferring the vehicle, not after. **Why does a mileage log matter if I know roughly what my business use is?** Because the claim is only as strong as the record behind it. A contemporaneous log — dates, destinations, purpose, odometer readings — supports the percentage claimed. An estimate reconstructed afterwards is the first thing reduced when a return is reviewed, and vehicle costs are usually a large enough number to be worth defending. **Should I pay myself salary or dividends as a contractor?** Both work, and the right mix depends on your income level, whether you want CPP coverage, whether you are borrowing personally, and whether the corporation needs to retain cash. Contracting income is often uneven, which makes the decision worth revisiting annually rather than setting once and leaving alone. ## A CPA who works with contractors Classification risk, subcontractor slips, equipment timing or just a year end approaching. Tell us how the work is structured and you will get a straight answer. [Get My Fixed Quote](https://www.everstonecpa.com/book-online)[Ask a Free Question](https://www.everstonecpa.com/quick-question) Tools and templates ## Free tools for this Practical templates and calculators you can use straight away — no charge and no sign-up. [Federal or provincial incorporation: which one fits your business](https://www.everstonecpa.com/blog/incorporating-federally-vs-provincially-canada) [Chart of accounts that survives growth and makes the T2 easier](https://www.everstonecpa.com/blog/chart-of-accounts-small-business-canada) [Trades accountant in Abbotsford](https://www.everstonecpa.com/trades-accountant-abbotsford) [Employment contract vs contractor agreement: what each document actually does](https://www.everstonecpa.com/blog/employment-contract-vs-contractor-agreement) [Trades accountant in Aldergrove](https://www.everstonecpa.com/trades-accountant-aldergrove) [Accounting for ecommerce and marketplace sellers](https://www.everstonecpa.com/ecommerce-accounting-hub) [T5018 Subcontractor Tracker (Free XLSX) A free spreadsheet for construction businesses: log subcontractor payments as you make them and get the running per-subcontractor total the T5018 needs.](https://www.everstonecpa.com/t5018-subcontractor-tracker) [Mileage and Vehicle Log (Free XLSX) A free vehicle log spreadsheet that calculates your business-use percentage automatically — the contemporaneous record a vehicle expense claim rests on.](https://www.everstonecpa.com/mileage-and-vehicle-log) [Payroll Remittance Calendar A free reference to the four CRA payroll remitter types, the withholding thresholds that set them, and exactly when each remittance falls due.](https://www.everstonecpa.com/payroll-remittance-calendar) [Monthly Bookkeeping Checklist A free one-page monthly bookkeeping routine: reconcile, categorize, review, file.](https://www.everstonecpa.com/monthly-bookkeeping-checklist) ## Every guide on this subject - [Construction holdbacks: when they become income and when the GST/HST is due](https://www.everstonecpa.com/blog/construction-holdbacks-accounting-canada) ## Local pages for this sector The same specialism, written for a specific city. [Contractor accounting in Chilliwack](https://www.everstonecpa.com/contractor-accountant-chilliwack) [Contractor accounting in Langley](https://www.everstonecpa.com/contractor-accountant-langley) [Contractor accounting in Maple Ridge](https://www.everstonecpa.com/contractor-accountant-maple-ridge) [Contractor accounting in Surrey](https://www.everstonecpa.com/contractor-accountant-surrey) [What a surety wants in the file](https://www.everstonecpa.com/for-lenders) ### Starting fees Every fee is fixed in writing before any work begins. - **Monthly bookkeeping, sales tax filing included** from $325 a month - **Payroll, remittances, T4s and ROEs** included in monthly bookkeeping - **Books, payroll and the year-end T2 together** $500–$700 a month - **Corporate year-end and T2 return** fixed fee, quoted in writing - **Personal tax return (T1)** from $125; self-employed or rental $275–$500 - **Catch-up bookkeeping** from $2,200 per year of records - **Controller or CFO support** controller from $1,650, CFO from $2,750 a month - **One-off advice call with a CPA** $225 plus GST [Get My Fixed Quote](https://www.everstonecpa.com/book-online) [Accounting for restaurants and hospitality](https://www.everstonecpa.com/restaurant-hospitality-accounting) [Accounting for realtors, PRECs and brokers](https://www.everstonecpa.com/real-estate-professionals-accounting) [Accounting for agencies and consultancies](https://www.everstonecpa.com/agency-consulting-accounting) [Fraser Valley Small Business Report How many businesses operate in each Fraser Valley municipality, and in which sectors — from Statistics Canada business counts.](https://www.everstonecpa.com/fraser-valley-small-business-report) [Benchmark your business See where your size and sector sit against comparable Canadian businesses. Free, no sign-up.](https://www.everstonecpa.com/benchmark-your-business) --- Source: https://www.everstonecpa.com/contractor-accounting-hub Prices: https://www.everstonecpa.com/pricing · Contact: info@everstonecpa.com · https://www.everstonecpa.com/book-online