Accountant for Finance Contractors Who Bill Through Their Own Corporation
An accountant for finance contractors looks after the corporation you bill through: the T2 return, bookkeeping, payroll, GST/HST and tax planning. As part of tax planning, we also review your contract and working facts for personal services business (PSB) risk. In Ontario, PSB income is taxed at 44.5% instead of the current 11.2% small business rate.
Who do we work with?
I work with finance professionals who bill through their own Ontario corporation. Most are FP&A analysts and managers, accountants, controllers, and risk, audit and compliance specialists. Many contract through a staffing agency to a bank, an insurer, a government or a large enterprise. The contract usually sets a fixed week of 37.5 or 40 hours.
You close books, build forecasts, test controls or review regulatory reports for a living. Our job is to keep your corporation compliant, plan how you pay yourself, and be straight with you about PSB risk.
We work with incorporated Canadian businesses only. If you are not yet incorporated, we can set up the corporation first.
What does an accountant for finance contractors do for you?
Everything below is work we already do for incorporated clients.
Corporate tax returns and bookkeeping
We prepare and file your corporation’s T2 return each year. We keep the books current, so invoices, agency payments, expenses and shareholder transactions are recorded properly. If CRA ever asks how your business runs, the records are the first thing it sees.
Payroll and salary vs dividend planning
We set up salary if you want it, prepare T4 slips and handle remittances. Each year, we plan the mix of salary and dividends. Salary paid to you stays deductible even if the corporation is a PSB, so the pay mix also affects your exposure. You can read more on salary vs dividend planning for contractors.
GST/HST filings
Once your corporation is registered, it charges HST on its invoices to the agency or client. We prepare and file the GST/HST returns.
Tax planning, including a review of your working facts
We review your contract and working facts as part of tax planning. We read the agency contract, the statement of work and the end client’s onboarding rules. We ask how the work actually happens. Then we tell you which facts point toward employment, which point the other way, and what to document. The detail is on our PSB contract review page.
We are accountants, not lawyers. If a clause needs new wording, that is for your lawyer.
CRA audit support and representation
If CRA reviews your corporation, you can authorize us as its representative. We then respond to CRA requests and questionnaires, organize your documents, deal with the auditor directly, and review and respond to proposal letters. See CRA PSB review support for what that process looks like.
Why do finance roles at banks and insurers carry PSB risk?
Under section 125(7) of the Income Tax Act, your corporation carries on a PSB when two things are true. First, you or a person related to you is a specified shareholder, which means owning 10% or more of any class of shares, directly or indirectly. Second, you would reasonably be regarded as an officer or employee of the client receiving the services if the corporation did not exist.
Banks, insurers and governments run on finance, risk, audit and compliance. These are core functions, not side projects. The tests from Wiebe Door Services Ltd. v. M.N.R. and 671122 Ontario Ltd. v. Sagaz Industries Canada Inc. ask whose business it is. When your work is part of how the bank closes its books or meets its reporting duties, that points toward integration with the bank’s business.
Regulated employers also run tight controls. They decide who gets access, who approves what and when work is due. Many of those rules exist for regulatory reasons and apply to every outside firm. They still show control, and CRA weighs them with everything else.
The agency in the middle does not settle it. CRA looks at whether you would reasonably be an employee of the party your services are really provided to, which is usually the end client. I cover the full rules, including the two exceptions, on our page about PSB risk for incorporated contractors. Agency setups are covered on our staffing agency contractor tax page.
Which PSB indicators show up in finance engagements?
These are the facts I see most often in finance engagements.
Background checks, onboarding and the code of conduct
Regulated employers screen everyone who gets access, including outside firms. A background check on its own is a weak signal. Staff-style onboarding is stronger: employee orientation, the employee handbook, and agreeing to the client’s code of conduct and policies on the same terms as staff.
Badges, system entitlements and the org chart
An access badge, a client email address and entitlements in the general ledger or reporting tools are normal for this work. Together, they can make you look like staff. Appearing on the client’s org chart, with a reporting line to a client manager, points to integration and supervision.
Sign-off authority and reviewing client staff
Many controller and senior accountant engagements carry approval or sign-off authority over journal entries, reconciliations or control tests. Some include reviewing or supervising the client’s own staff. Both put you inside the client’s management and control structure.
Month-end calendars and fixed hours
The client sets the close calendar. It decides what you work on and when. A fixed 37.5 or 40 hour week, timesheets approved by a client manager and set onsite days add to the control picture. Hours alone never decide PSB status. The whole relationship is tested, year by year.
How CRA may read finance engagement facts
| Finance engagement fact | How CRA may read it | What we note on file |
|---|---|---|
| Client background check and onboarding | Weak on its own if every outside firm goes through it; stronger if onboarding mirrors new staff | Whether the same process applies to all vendors |
| Client code of conduct and policies | Control, if you are bound and managed like staff | Whether it is a regulatory condition for every vendor |
| Access badge, client email and system entitlements | Control and integration, because you look and work like a team member | The security reason, and which tools your corporation provides |
| Name on the client org chart | Integration into the client’s structure and reporting lines | Who you report to, and for what |
| Approval or sign-off authority | Strong integration, because you act inside the client’s control framework | What you sign, under whose authority, and whether it is in your scope |
| Supervising or reviewing client staff | Strong control and integration, because it is a management role in the client’s business | Whether the review is a deliverable or an ongoing staff duty |
| Month-end calendar set by the client | Control over when and what you work on | Whether deadlines tie to deliverables in the statement of work |
| Fixed 37.5 or 40 hour week | Control over how much you work, never decisive alone | Whether the hours are a billing cap or a required schedule |
| Engagement covers a staff seat, such as a leave | Integration, because you do an employee’s job | The scope, the end date and any project deliverables |
One row does not decide anything. CRA weighs the whole relationship, and so do we.
What does PSB status cost an Ontario corporation?
The tax gap is large. Take $150,000 of income kept in an Ontario corporation. At the current 11.2% small business rate, corporate tax is $16,800. As a PSB at 44.5%, it is $66,750. That is $49,950 more for each year the treatment applies.
The 44.5% is 33% federal, which includes the additional 5% tax under section 123.5, plus the 11.5% Ontario general rate. The 11.2% rate applies to income earned from July 1, 2026. Income earned before that date was taxed at 12.2%, so a December 31, 2026 year-end gets a blended 11.70%, or $17,543.84 on the same $150,000.
A PSB also loses most deductions. Section 18(1)(p) allows only salary and other pay to you, the cost of your benefits or allowances, certain costs of selling property or negotiating contracts that an employee could deduct, and legal costs to collect fees owed for your services. Rent, software, equipment, travel, phone, insurance and accounting fees are denied.
What can you do to support your position?
Nothing here promises a result. These steps help you show the facts as they are.
- Keep the agency contract, the statement of work, every renewal and the client’s onboarding rules.
- Note the reason for each security or policy requirement.
- Where you can, scope work by deliverables, such as a model, a process or a remediation project, rather than an open-ended seat.
- Pay for your own equipment, software, training and professional liability insurance where the client allows it.
- Keep records of other clients, proposals and marketing.
- Describe the work delivered on your invoices, not only the hours.
- Review the facts each year, especially after a renewal, a new manager or a change in duties.
Two CRA documents come up often. Guide RC4110, “Employee or Self-Employed?”, explains how CRA looks at a working relationship. Form CPT1 is the request for a CPP and EI ruling on a worker’s status. That ruling covers CPP and EI only and is not a PSB ruling for income tax, even though CRA looks at similar facts. We review whether a request is useful in your facts.
Why work with Gondaliya CPA?
I am Sharad Gondaliya, CPA (Canada and USA), Founder and Managing Director of Gondaliya CPA Professional Corporation. Our team includes a second designated CPA (CPA Ontario) and bookkeeping support staff. We work on a fixed flat-fee model. We are a 2026 Xero Awarded Firm, with 1300+ five-star Google reviews.
Our office is at 55 Queen St E, Suite 1205, Toronto. We are open 9AM to 8:30PM, Monday to Sunday.
If you are an incorporated finance contractor and want a clear view of your corporation’s tax position and PSB risk, please book a consultation. Please bring your agency contract, your statement of work and the client’s onboarding rules. You can also call us at 647-212-9559 or email info@gondaliyacpa.ca.
Frequently asked questions
What does an accountant for finance contractors do?
We look after the corporation you bill through: the T2 return, bookkeeping, payroll, GST/HST filings and tax planning, including salary and dividend planning. As part of tax planning, we review your contract and working facts for PSB risk.
Does working through a staffing agency protect me from the PSB rules?
Not on its own. In a three-party arrangement, CRA looks at whether you would reasonably be an employee of the party your services are really provided to, which is usually the bank, insurer or government. The agency contract and the client’s onboarding rules both matter.
Does sign-off authority at the client increase PSB risk?
It can. Approving journal entries, reconciliations or control tests for the client, or reviewing its staff, puts you inside the client’s control structure. CRA may read that as integration and control. We note what you sign and whether it is part of a defined scope.
Is a fixed 37.5 or 40 hour week enough to make my corporation a PSB?
No. Fixed hours are a control indicator, but hours alone never decide PSB status. CRA looks at the whole relationship, including control, tools, chance of profit and risk of loss, and integration, year by year.
What is the tax rate if my corporation is a PSB in Ontario?
The combined rate is 44.5%, compared with the 11.2% small business rate that applies from July 1, 2026. On $150,000 of corporate income, that is $66,750 instead of $16,800. Most deductions are also denied under section 18(1)(p).
Can you rewrite my contract to lower PSB risk?
We are accountants, not lawyers, so contract wording is for your lawyer. We review your contract and working facts as part of tax planning and tell you which facts to document.
Do you work with finance contractors who are not incorporated?
We work with incorporated Canadian businesses only. If you are not yet incorporated, we can set up your corporation, and then look after its T2 return, bookkeeping, payroll, GST/HST and tax planning.
What happens if CRA reviews my corporation for PSB status?
We step in as your corporation’s authorized representative. We answer CRA’s requests and questionnaires, put your documents in order, communicate with the auditor, and review and respond to any proposal letter.