One of the most common questions Canadian business owners ask is:
“Do I actually need to issue a T4A for this?”
Instead of guessing—or waiting until your accountant gives you bad news in February—use this simple checklist‑style guide to quickly assess whether a payment may require a T4A slip for the 2025 filing season.
(This is general information, not legal or tax advice. Always confirm with a professional or the CRA for your specific situation.)
Step 1: who did you pay?
Start by asking: who received the payment?
• Employee on payroll with regular deductions → usually T4, not T4A
• Contractor, freelancer, or self‑employed individual → possibly T4A
• Corporation or business entity → may or may not require a T4A, depending on the type of payment
If they’re clearly an employee, with deductions and remittances, you’re probably in T4 territory, not T4A.
Step 2: what was the payment for?
Was the payment for:
• Ongoing services (consulting, coaching, training, design, refereeing, driving, etc.)?
• Professional services (legal, accounting, advisory)?
• Commissions or finder’s fees?
• Other income the CRA classifies under T4A boxes?
If the payment looks like service fees or similar income, it’s a strong hint that T4A reporting might be involved.
Step 3: is this business‑related income?
Consider whether:
• You paid this amount as part of your business or organization’s operations
• You intend to deduct these payments as business expenses
If it’s personal (for example, you paid a friend to help you move house), that’s usually outside T4A territory. If it’s a business expense, you’re closer to T4A requirements.
Step 4: total paid during the year
Look at the year‑end totals per recipient:
• Add up all payments made to the same person or business for the year
• Compare against current CRA guidance for that type of payment
If the amounts are small and infrequent, T4A may not be required— but “small” is a technical term in tax, so verify against up‑to‑date CRA rules or with your accountant.
Step 5: is the recipient a non‑resident?
If the recipient doesn’t live in Canada, you might be in T4A‑NR territory instead of regular T4A. That involves different rules and possibly withholding tax.
If you’re paying non‑residents for services performed in Canada, talk to an accountant or review CRA’s latest non‑resident guidance before year‑end if possible.
Quick yes/no checklist
For each payee, run through this:
1. Is this person or entity an employee on payroll?
• Yes → likely T4, not T4A
• No → go to 2
2. Did I pay them for services or other income that CRA treats as T4A‑type income?
• No → likely no T4A
• Yes → go to 3
3. Did I pay them as part of my business or organization (not personally)?
• No → likely no T4A
• Yes → go to 4
4. Is the total paid over the year high enough that CRA expects a slip for that category?
• Possibly yes → T4A may be required
• Unsure → check CRA guidance or ask your accountant
If you get multiple “yes” answers, it’s a strong signal that you should seriously consider issuing a T4A.
Common situations where T4A is often considered
Here are examples where the T4A question usually comes up:
• Paying regular fees to independent coaches, trainers, or instructors
• Paying freelance designers, bookkeepers, or marketing contractors
• Paying commissions to non‑employees for finding clients or deals
• Paying honouraria to speakers or advisors
These aren’t automatic T4A situations—but they’re red flags to at least review.
Building a repeatable process for 2025 and beyond
Rather than asking “Do we need a T4A?” every February, build a simple year‑round process:
• Flag contractors and other non‑employee payees when you onboard them
• Capture SIN, business number, and address early, not at year‑end
• Tag payments in your accounting system so they’re easy to summarize later
• Review your list with your accountant before the busy season
Tools like T4ASlip help you organize this information so you can apply the checklist consistently each year instead of reinventing it.
Final word
You don’t need to be a tax expert to avoid T4A headaches. If you:
• Know which payments are to employees vs contractors
• Keep good records of who you pay and why
• Use a simple checklist to review who needs slips
…you’ll be ahead of many businesses. From there, software and professional support can help you handle the technical details and filing steps for 2025 and future years.