Topic: Anybody ever work as a contractor?

[mmret]

I'm curious as to what the typical premium is for a contractor's pay given that you get no benefits, no bonus, etc.

And any other things to watch out for. Is there some kind of anti-contractor sentiment?

How much are the tax writeoffs usually worth?

[99 Silver]

Be careful with this.

You have to contract for more than one company or the government will deem you to be an employee negating the advantages.  The use of a home office has to be very carefully considered because there are a lot of rules attached. 

Get one of those tax books.  They will give you all the ins and outs.

[ArticSteve]

You have to contract for more than one company or the government will deem you to be an employee negating the advantages.

For the most part that is correct.  There is an exception for Limited Companies.  So if you were to create a limited company and all transactions were between your limited company and the organization that is supplying you the work then you'd be OK.  You would also need to have a written contract between your limited company and the client.

You cannot receive any benefits outside your limited company from the client.

[mmret]

Interesting, thanks Silver and AS.

Seems like creating the Ltd. company (IIRC its fairly straightforward) is a more or less sure way to get this done? Of course perhaps not in the spirit of the law...

[Ex-airbalancer]

You have to contract for more than one company or the government will deem you to be an employee negating the advantages.

For the most part that is correct.  There is an exception for Limited Companies.  So if you were to create a limited company and all transactions were between your limited company and the organization that is supplying you the work then you'd be OK.  You would also need to have a written contract between your limited company and the client.

You cannot receive any benefits outside your limited company from the client.

Also watch out for WSIB, even has a limited company you have contracts or POs or invoices from different or they will deem as an employee on the company for WSIB
There is not that many tax breaks anymore 
Also as a limited company you need an accountant to do the books, and you have keep your minute book up to date ( I need to make a phone call)

[mmret]

You have to contract for more than one company or the government will deem you to be an employee negating the advantages.

For the most part that is correct.  There is an exception for Limited Companies.  So if you were to create a limited company and all transactions were between your limited company and the organization that is supplying you the work then you'd be OK.  You would also need to have a written contract between your limited company and the client.

You cannot receive any benefits outside your limited company from the client.

Also watch out for WSIB, even has a limited company you have contracts or POs or invoices from different or they will deem as an employee on the company for WSIB
There is not that many tax breaks anymore 
Also as a limited company you need an accountant to do the books, and you have keep your minute book up to date ( I need to make a phone call)

Ok, probably no longer worth the effort unless I simultaneously start up some side projects.

[99 Silver]

Figure on about $1,000 to set up a corporation, plus about $1,000 per year for legal and accounting fees based on you doing your own book keeping.

The big advantage of a Corp is you can make your wife a shareholder and split all the income with her via dividends.  Also make the company year end not be December 31st to delay the payment of personal taxes.

[mmret]

The big advantage of a Corp is you can make your wife

Back that truck up a second.

[Snowman]

I was sole proprietor for 10 years until last week when I got the company tattoo . Generally speaking you can claim $50k in expenses on $150k in revenues before the alarm bells go off with the feds. One year they called me in and were so far up my ass I could taste Brylcreem. After the appeal I was cleared of any perceived accounting errors. You can fight the law and win.

[wing]

Hey that's good to know.  That's 1/3 expenses.  My expenses were somewhere around 1/10th so I should be good.

[initial_D]

I worked as a contractor and an employee, a couple of times for the same company. Nortel was one of them. My rates were $50 ~ $80 as a contractor, depends on the project and which department. The biggest downside was gigs can be terminated with no notice, and there can be some laps of time in-between gigs. First level contractor with IBM can net $70-$100, second level subcontractor can net $50-$60.

If only doing side projects, you can get a GST number, and bill yourself out as a company. Don't really need to register for a company, no coporate filing at year end. Some expenses can be claimed and deducted. I believe 15% of the home can be claimed as business expenses, along with the all the utility bills. Vehicle usage can be used as claim, make a mileage log. There are a lot of benefit of having a side business, added income and deductible expenses.

Lastly, get a good accountant.

[Ex-airbalancer]

I was sole proprietor for 10 years until last week when I got the company tattoo . Generally speaking you can claim $50k in expenses on $150k in revenues before the alarm bells go off with the feds. One year they called me in and were so far up my ass I could taste Brylcreem. After the appeal I was cleared of any perceived accounting errors. You can fight the law and win.

But there is also a cost to fight law

[Ex-airbalancer]

Figure on about $1,000 to set up a corporation, plus about $1,000 per year for legal and accounting fees based on you doing your own book keeping.

The big advantage of a Corp is you can make your wife a shareholder and split all the income with her via dividends.  Also make the company year end not be December 31st to delay the payment of personal taxes.

I believe your personal taxes are still need to be file by April 30

[Ex-airbalancer]

Lastly, get a good accountant.

This is probably the first thing to do

[safristi]

..that is AFTER becoming a Valuable & Knowlegable CONTRACTOR...NO!!???