Trades Contractors
Bookkeeping and tax support designed for Canadian trades contractors
Electricians, plumbers, HVAC technicians, and general contractors operate in a project-based environment. Income is irregular, expenses are ongoing, and compliance requirements are specific to the construction sector.
Teplov CPA provides bookkeeping, tax compliance, and tax planning for trades contractors across Canada, whether you operate as a sole proprietor or through a corporation.
Common Situations We See
Trades contractors typically contact us in one of the following situations:
– Income arrives project by project and varies month to month.
– HST on labour versus materials is unclear.
– Subcontractors were paid but T5018 reporting has not been handled.
– Equipment and tools were purchased without clarity on CCA treatment.
– Cash payments were received and records are incomplete.
– Incorporation has been suggested but no formal analysis was done.
– Tax season feels reactive rather than organized.
Our role is to create structure, ensure compliance, and provide clear guidance based on your revenue level, province, and long-term goals.
Our Services for Trades Contractors
Monthly Bookkeeping
Accurate records throughout the year reduce compliance risk and provide visibility into profitability.
We provide:
– Monthly transaction categorization
– Bank and credit card reconciliations
– Project-based income tracking
– Expense categorization and monitoring
– HST tracking and periodic filings
– Financial statements including profit and loss and balance sheet
– Year-end file preparation to support tax filing
Bookkeeping is delivered using Xero or QuickBooks Online, configured specifically for project-based trades income.
Tax Compliance
We prepare and file returns accurately and on time, with a CPA who understands construction sector requirements.
Services include:
– T1 personal income tax returns
– T2125 self-employment income reporting
– T2 corporate tax returns where applicable
– T5018 subcontractor reporting
– HST registration and periodic filings
– Quarterly installment calculations
– CRA correspondence support related to prepared filings
Once revenue exceeds $30,000 in a rolling 12-month period, HST registration is generally required. Labour and materials supplied as part of most contracts are taxable supplies. The structure of your contract determines how materials are treated, and this must be reviewed carefully.
If subcontractors were paid more than $500 during the calendar year for construction services, T5018 slips are required. This is a routine compliance requirement in the trades sector and should be handled annually.
Tax Planning for Trades Contractors
Tax planning focuses on income structure, asset management, and long-term strategy.
Incorporation Analysis
Incorporation may be appropriate if:
– Net income is consistently strong
– You do not require all earnings personally in the same year
– You want to retain earnings for equipment purchases or business growth
We analyze your historical income, projected earnings, province of residence, and personal cash flow needs. You receive a clear comparison of remaining a sole proprietor versus incorporating.
Equipment and Capital Cost Allowance
Vehicles, trailers, heavy equipment, and specialty tools are depreciable assets with specific CCA classifications. Proper classification affects how deductions are calculated each year. We maintain structured depreciation schedules to ensure accuracy.
Cash Handling and Documentation
All income must be reported regardless of payment method. Proper documentation protects you in the event of CRA review. Accurate bookkeeping ensures your records reflect actual business activity.
Installment Planning
If tax owing exceeded $3,000 in a prior year, quarterly installments may apply. We calculate installment obligations before deadlines to reduce interest exposure.
Frequently Asked Questions
Once registered, you must charge HST on taxable supplies. For most trades contractors, labour and materials supplied under a contract are taxable. Certain contract structures may affect treatment, which should be reviewed.
The T5018 reporting requirement applies regardless of how payment was made. If subcontractors were paid more than $500 for construction services during the calendar year, reporting is required.
CRA conducts compliance activity in the trades sector, particularly around unreported income, HST remittance, and subcontractor reporting. Accurate records and correct filings reduce exposure.
2025 Tax Return
The filing deadline for self-employed Canadians is June 15, 2026. Any balance owing is still due April 30, 2026.
We are currently accepting new trades contractor clients for the 2025 tax year.
Get started
Email contact@teplov.ca or use the contact form with a brief description of your situation, including:
– Approximate annual income
– Whether you are incorporated
– Whether you have US clients
– What you are trying to resolve
We typically respond within one business day.