As a contractor, you are considered self-employed and to get paid, you must submit invoices. Here is our pay schedule for the year: 2016 Pay Schedule (for contractors and employees)
The Pay Schedule is also available here if the above link doesn’t work, or search for 2016PaySchedule if you have access to our Team Library on Box: https://erw.box.com/s/z7fz3agccx24mjthoxdzibvqvi5c8dz8
Invoices should be sent to email@example.com, and are due end of the day the Monday after the pay period ends
At the warehouse, you should also be filling out a timesheet that we provide for each pay period.
If you do not have an invoice set up, please feel free to use this template or create your own based on it: Basic Invoice Template. It can be opened in older and newer versions of Excel, Numbers (Mac). If you don’t have access to either of these, it can also be imported into Google Sheets, which is a free web-based spreadsheet program. From there, you can export it to Excel format to send for payroll processing.
The invoice only needs to have a simple total of your hours on the timesheet – it acts as a summary sheet and is required for our bookkeeping and your self-employed bookkeeping purposes.
If you have any questions – invoices, self-employment taxes, anything, don’t hesitate to ask Ruth in the office!
How to Invoice Using Our Template
Fill in the [fields] with your info. The invoice # can be any number really, or just start with #1 and go in sequence. As long as each invoice you give to anyone has a unique number (perhaps you’re a contractor for two different companies at the same time), it’s all good.
Fill in a general description (like “warehouse, event install and takedown hours”), your rate per hour, total of hours for that line and it should total everything for you. Because your handwritten timesheet at the warehouse is already filled in with specific job details (ideally, the project/job # if it’s for a particular event), you only need to have one line with the total hours from your timesheet. This invoice just serves as a summary sheet. We also need this for bookkeeping purposes and you will need to have records for tax time next year.
You won’t have to deal with GST until you reach $30,000 of income within any consecutive 12 months. This is when Revenue Canada no longer considers you a “small supplier”. If this ever happens, you’d need to apply for a GST number, have it on all your invoices going forward, and start charging and remitting it to the CRA.
Keep in mind that when you’re a contractor, there are no tax, pension (CPP) or EI deductions. You will not receive a T4 slip. Instead, you report this income on your taxes under self-employment income. It’s wise to start keeping receipts for any kind of expenses that are required for you to obtain income. For example, the cost of your steel toed boots can be deducted from your income. If you have to drive anywhere for your work, keep a log book of all your work trips. Reducing your income by claiming expenses will reduce your tax payable.
If you make less than a certain amount of income, you won’t end up owing much to CRA. If you’re not sure what your tax situation will be like for the year, it’s a good idea to start setting aside a bit of each paycheck for next year’s tax season. You’re not required to pay EI premiums, but if being self-employed is a serious endeavour, you can choose to start paying into it. You can use the CRA’s online payroll calculator to see what would normally be deducted and submitted to the CRA on your behalf. If you go this route, our advice is to look at the calculations and for each paycheck, set aside an amount equal to:
- double the CPP amount deducted (to equal the employee and employer amounts)
- skip the EI premiums (unless you’d like to start paying into – you must self-enrol using your business number)
- depending on how much self-employment income you’ll be making during the year, anywhere from 2/3 up to the same amount as the income tax deducted should be a safe bet