Most businesses don’t set out to ignore T4A rules—they just get busy, confused, or depend on spreadsheets that fall apart at year-end. Unfortunately, the CRA still expects correct information returns, and common mistakes can lead to penalties or extra scrutiny.
Here are 10 frequent T4A mistakes and how to avoid them.
1. Treating contractors like employees but using T4A anyway
If someone looks and acts like an employee, but you issue them a T4A instead of a T4, you’re sending mixed signals. Misclassification is a major CRA concern.
Avoid it by: reviewing worker status (control, tools, chance of profit, risk of loss) and being consistent in how you treat and report them.
2. Not issuing any slips for contractors
Some businesses assume, “They’re self-employed, so I don’t have to issue anything.” For certain types of payments, CRA expects T4A slips even when the recipient is self-employed.
Avoid it by: identifying which contractor payments fall into T4A categories and setting up a basic process to capture data and generate slips.
3. Waiting until the last minute
Collecting SINs or other details in February is painful. People move, ignore emails, or forget.
Avoid it by: collecting recipient information when you start working with them, not at year-end when everyone is busy and unresponsive.
4. Incomplete or incorrect recipient information
Missing names, wrong addresses, or incorrect SINs can cause problems and corrections later.
Avoid it by: validating details up front and keeping a central record you update when something changes. Don’t rely on random email threads to store key info.
5. Reporting the wrong amount
If you rely on multiple spreadsheets or ad-hoc exports, it’s easy to miss payments or duplicate them.
Avoid it by: using a consistent method to pull all payments by recipient from your accounting system and reconciling against invoices and bank records.
6. Forgetting non-resident situations
Paying non-residents for services in Canada and treating them like regular contractors can be a serious mistake. T4A-NR and withholding tax rules may apply.
Avoid it by: flagging non-residents early and getting professional advice before payments become significant, not after the year is over.
7. Mixing personal and business payments
When owners pay people personally but also claim business deductions, things get messy fast.
Avoid it by: running business-related payments through a business account and documenting whether a T4A is required. Keep personal and business spending clearly separated.
8. Filing late
Late information returns can trigger penalties, even when the amounts are correct.
Avoid it by: setting internal deadlines before the CRA’s official deadline and using reminders or automation to stay on track. Treat T4A season like any critical project with a timeline.
9. Not keeping supporting records
If the CRA asks how you arrived at the amounts on your T4As, “we guessed” won’t go over well.
Avoid it by: saving invoices, contracts, and payment summaries in an organized way that ties to each T4A. Digital storage, with clear folder structures per year, works very well.
10. Relying entirely on memory and manual processes
The more your process lives in people’s heads and scattered spreadsheets, the higher your error rate.
Avoid it by: standardizing your T4A workflow and using tools like T4ASlip to centralize data, validate information, and generate slips consistently.
Turning mistakes into a checklist
Each of these common mistakes can be flipped into a positive checklist:
• Clearly classify workers (employee vs contractor)
• Track contractor payments by recipient throughout the year
• Collect and verify contractor information up front
• Flag non-resident cases early
• Set clear internal deadlines and reminders
• Use systems, not memory, to run your T4A process
Do that, and you’ll avoid most of the traps that create penalties and stress.
How T4ASlip reduces error risk
A dedicated T4A tool like T4ASlip can:
• Pull data from your existing payment records
• Flag missing or inconsistent information
• Help you keep a single source of truth for contractors and payments
• Generate slips in a repeatable, auditable way
Instead of heroic, last-minute efforts every year, T4A compliance becomes a straightforward, repeatable process. That’s better for you, your accountant, and the CRA.