Come February, every Canadian employer faces the same question: does this person get a T4 or a T4A? Choosing wrong can trigger CRA reassessments and penalties. Here's the clear distinction.
A T4 reports employment income for people on your payroll. It shows salary/wages, CPP, EI, and income tax withheld. If you withhold source deductions and the person is an employee, they get a T4. Learn the withholding side in our payroll deductions guide.
A T4A reports other types of income: pension, annuities, self-employed commissions, fees for services from contractors, scholarships, and certain other payments. No CPP/EI is withheld on most T4A amounts.
| T4 | T4A | |
|---|---|---|
| For | Employees | Contractors, pensions, fees for service |
| CPP/EI withheld | Yes | Usually no |
| Income tax withheld | Yes | Usually no |
| Deadline | Last day of February | Last day of February |
The biggest risk isn't the slip — it's misclassifying an employee as a contractor. The CRA looks at control, ownership of tools, and risk of profit/loss. Get it wrong and you can owe back CPP, EI, penalties, and interest. Read our guide on employee vs contractor in Canada.
Both slips are due by the last day of February. Our Calgary payroll services prepare and file them for you. Talk to us.
A T4 reports employment income for people on your payroll, with CPP, EI, and income tax withheld. A T4A reports other income such as contractor fees for service, pensions, and commissions, usually with no CPP/EI withheld. Employees get a T4; contractors and pension recipients get a T4A.
Genuine independent contractors receive a T4A (fees for services), not a T4. If the worker is actually an employee under the CRA's control and integration tests, they must receive a T4 and have source deductions withheld.
Both T4 and T4A slips must be issued to recipients and filed with the CRA by the last day of February following the calendar year. Late filing triggers per-slip penalties.
Misclassifying an employee as a contractor (T4A instead of T4) can lead the CRA to reassess unremitted CPP and EI plus penalties and interest. When in doubt, review the relationship against the CRA's control, tools, and risk factors, or ask an accountant.
Have questions about payroll? Swift Accounting Ltd. helps Calgary business owners get it right. Contact us for a free consultation.
