Determine if the worker’s corporation is carrying on a PSB

One of the conditions to determine if a corporation is carrying on a PSB is that the worker who provides services to the payer on behalf of the corporation would reasonably be considered an employee of the payer if the corporation did not exist. This is a question of fact.

Factors to consider

Determining if the worker would reasonably be considered an employee of the payer if the corporation did not exist is similar to determining if a worker is an employee or is self-employed.

This must be analyzed on a case-by-case basis by looking at the working conditions of the worker when providing services to the payer (the corporation’s client). Each case is unique and requires a thorough review of the facts.

Review the factors considered when determining the employment status of a worker: Employment status: Employee or self-employed.

If you determine that the worker would reasonably be considered an employee of the payer if the corporation did not exist and if all the other conditions mentioned above are met, the worker’s corporation is considered to be carrying on a PSB.

Request a CPP/EI ruling

A worker who provides services to a payer (the corporation’s client) through a corporation carrying on a PSB can be an employee of the PSB or self-employed.

• You cannot ask the CRA for a CPP/EI ruling to determine if a worker would reasonably be considered an employee of the payer if the corporation did not exist
• You can ask the CRA for a CPP/EI ruling to determine if a worker is an employee of the PSB

Learn more on how and when to request a ruling: Request a CPP/EI ruling.