When you work as a consultant pharmacist for RPI Consulting Group Inc, your T4 will be filled in a slightly different way.
Navigating Through the T4
If you’ve completed a short-term contract with one of our Clients and you’re looking at your T4, you’ll notice that your earnings are placed in Box 81 of the form. This isn’t an error, we can assure you! We recommend that you take a look at the Canada Revenue Agency’s document called “Employers’ Guide: Payroll Deductions and Remittances.”
Page 47, under the section titled “Placement and employment agency workers”, says:
“b) When an agency places workers in an employment under the direction and control of a client of the agency and the agency pays the worker, the agency has to deduct CPP contributions and EI premiums, but not income tax. The agency has to prepare a T4 slip for the worker.”
It goes on further to say “The gross earnings of workers described in paragraphs b) and c) must be reported on their T4 slip. For reporting instructions, see Guide RC4120, Employers’ Guide – Filing the T4 Slip and Summary.”
In Guide RC4120, under “Code 81”, the explanation is as follows: “In the “Other information” area at the bottom of the T4 slip, use code 81 for scenarios “b” and “c” and enter the gross earnings of placement and employment agency workers. In short, healthcare/pharmacy personnel hired through us should look for their earnings on Box 81.
How This Differs from Other Self-Employed Work
Typically, when a self-employed individual works for another company, a T4 is filled out on their behalf. This T4 indicates the amount of money earned by the self-employed individual with that particular company. If this work was initiated without the assistance of an employment agency or recruiting agency (like RPI Consulting Group Inc.), then total earnings are entered into Box 14 of the T4.
However, for the purposes of pharmacy jobs provided to you by RPI Consulting Group Inc, earnings will be found in Box 81.
What to Do With This Information
Agency workers can take the amount from Box 81 of their T4 and transfer it to their self-employed income return to write off business expenses incurred during your pharmacy work. Examples of business expenses include maintenance of your pharmacist’s lab coat and fuelling/operating your vehicle. Just remember to keep all of your receipts so that you can prove these expenses, in case you are audited by the CRA.