If you are in the construction industry and you make payments to subcontractors for construction services, you may have to issue T5018 slips to your subcontractors.
The T5018 slip is sort of a T4 for subcontractors. It was implemented by Canada Revenue (CRA) to try to get control of unreported income in the construction industry. Now, CRA has placed a reporting burden on the prime contractor to report subcontract payments so CRA can make sure the income gets reported on the subcontractor’s tax return.
Anyone in the construction industry who hires subcontractors should:
- Make sure to get complete name, address, business number or SIN of subcontractors
- Prepare and file T5018s and a T5018 summary once a year on either a calendar year or fiscal year basis.
To make things simple consider using Padgett Business Services to pay your subcontractors, keep track of payments made and prepare and file the T5018s. Contact us for full particulars at 780-434-7146 or firstname.lastname@example.org