It makes total sense. By paying the guy under the table and off the books, you are encouraging tax evasion, and an underground economy. The guy refusing to pay the freeman is doing 100% the right thing. There are laws in this country that need to be adhered to, and paying taxes is one of them. Roads, schools, health care etc..... doesn't magically pay for itself.
Precisely. Not to mention, he has to look out for his own business as well.
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Like anyone else, I wish I paid less tax, but the trade off of having incredible places to go, and to be able to live in an incredibly civilized and safe country is more than a fair trade off.
I agree, I just need to find the place on the tax form to indicate that my tax money is for infrastructure and social programs and not a $16 glass of orange juice.
That makes no sense. By not paying the guy, the government still doesn't get their GST nor do they get their taxes. If that company was so caring about the government getting ripped off they should send the money owed to the freeman directly to the government.
I still owe him that money, I can't just pay it to someone else. He just has to live up to the terms of our agreement to collect it, which are very much industry standard and not at all onerous. If he chooses not to, which he is willingly doing, that's not my problem.
I still owe him that money, I can't just pay it to someone else. He just has to live up to the terms of our agreement to collect it, which are very much industry standard and not at all onerous. If he chooses not to, which he is willingly doing, that's not my problem.
Two things.
1. It is not at all uncommon to require a subcontractor to be GST registered or even incorporated and it is required to be included on any invoice the contractor submits. Look at any invoice or receipt, the company's GST number is on it somewhere.
2. The company should have had his GST/Business Number on file before any contract was signed. Hell, its supposed to be included IN the contract. If it wasnt there can be a claim that the contract is invalid. So the company either didnt do, or didnt stick with it's required due diligence by having him perform the work anyways.
If you cant pay the guy because he doesnt have or wont provide a GST/Business number then both parties are at fault because if it was a stipulation of the contract then he should have been deemed ineligible to be granted that contract on those grounds.
I can see a big shout here that the contract is invalid because he shouldnt have been eligible to receive it and the company doesnt have the required information to see it fulfilled.
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2. The company should have had his GST/Business Number on file before any contract was signed. Hell, its supposed to be included IN the contract. If it wasnt there can be a claim that the contract is invalid. So the company either didnt do, or didnt stick with it's required due diligence by having him perform the work anyways.
I can see a big shout here that the contract is invalid because he shouldnt have been eligible to receive it and the company doesnt have the required information to see it fulfilled.
In what crazy ass world is the inclusion of a GST registration number a fundamental term of a services contract??? I mean, granted, you usually see it, but it's by no means necessary.
I just wanted to note that if they were really growing exponentially we would be surrounded by them by now....
I think the federal Government is just waiting until there are enough of them and then they're going to invite Vladimir Putin over for a 'conference' in order to hunt....
In what crazy ass world is the inclusion of a GST registration number a fundamental term of a services contract??? I mean, granted, you usually see it, but it's by no means necessary.
That depends entirely on company policy as I explained earlier.
If its policy to require one, then yes, its necessary. And its extremely common.
Is it 'legally necessary?' Of course not. If its a $2000 job and you have no idea what the contractor's GST status is then fine. The fact of the matter remains, most major companies simply DO NOT CARE. They want to pay what the job costs plus GST. It keeps their accounting and tracking simple.
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It makes total sense. By paying the guy under the table and off the books, you are encouraging tax evasion, and an underground economy. The guy refusing to pay the freeman is doing 100% the right thing. There are laws in this country that need to be adhered to, and paying taxes is one of them. Roads, schools, health care etc..... doesn't magically pay for itself.
How is not paying someone the GST paying someone under the table? Having a GST number isn't always necessary to have a business and get paid. Just because you don't collect GST, doesn't mean you work under the table. Nice little rant at the end that had nothing to do with my post.
Withholding money because a business doesn't have a GST number is for the company's own benefit and trying to twist it into a "government tax collector hero" is lame.
so please try to answer my question without going on a patented pylon rant.
How does someone not collecting GST equate to tax evasion?
That depends entirely on company policy as I explained earlier.
If its policy to require one, then yes, its necessary. And its extremely common.
Is it 'legally necessary?' Of course not. If its a $2000 job and you have no idea what the contractor's GST status is then fine. The fact of the matter remains, most major companies simply DO NOT CARE. They want to pay what the job costs plus GST. It keeps their accounting and tracking simple.
I get that you're an accountant and you see lots of invoices but I also write a lot and see a bunch with a lot of home builders and the GST number isn't always necessary. I don't know what work the guy did but if the only reason he wasn't paid was because of a GST number then that's effin lame.
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How is not paying someone the GST paying someone under the table? Having a GST number isn't always necessary to have a business and get paid. Just because you don't collect GST, doesn't mean you work under the table. Nice little rant at the end that had nothing to do with my post.
Withholding money because a business doesn't have a GST number is for the company's own benefit and trying to twist it into a "government tax collector hero" is lame.
so please try to answer my question without going on a patented pylon rant.
How does someone not collecting GST equate to tax evasion?
We may not get along on these forums, but I really do not believe you are as dense as your post suggests.
The entire premise of being payed 'off the books' is to not have to declare revenue. Be it personal income, or sales tax. Maybe Locke can expand on it, but I believe, a company can recover the GST paid if they do not exceed $30,000/yr in revenue. However, if they do not collect it, once they exceed $30,000 they must pay it retroactively. Why would you not collect GST under that set of rules? Just collect the damn thing and you have nothing to worry about. Also a large company contracting a subcontractor doesn't care if he has to pay the GST or not in regards to their company ledger. It makes no difference as it would never go in a profit or loss column. It is static, and it just has to be paid. It may as well not exist, as long as the company is not cheating the system, and not remitting it back to the government.
At the end of the day, there is ZERO reason, to not collect it if you are running a legitimate business. And anyone not collecting it, usually would be, and should be suspect that they are cheating the system both personally, and corporately. And why would you want to do business with a crooked company?
Now I ask you, give me one reason, that you shouldn't follow the rules set by the CRA.
You still aren't getting it. The guy did not ask to be paid under the table. He wrote them an invoice without a GST number which is totally normal. Even if it is mandatory for that company, it has nothing to do with tax evasion. The guy did not ask for GST without a GST number, he only wanted what he was supposed to be paid so if he's not collecting GST and under 30k then he is not evading taxes.
You still aren't getting it. The guy did not ask to be paid under the table. He wrote them an invoice without a GST number which is totally normal. Even if it is mandatory for that company, it has nothing to do with tax evasion. The guy did not ask for GST without a GST number, he only wanted what he was supposed to be paid so if he's not collecting GST and under 30k then he is not evading taxes.
Read the post and entire premise again.....
Quote:
Originally Posted by Potty
I work in the construction industry and hired a guy to do some subcontract work, who I didn't know at the time was a freeman. On the purchase order I sent him, it said he needed an active GST number in order for any payments to be processed, which he obviously didn't read.
Fast forward two years and he stops by the office every couple weeks to rant and rave and yell at me for not paying him and I tell him to give me the GST number per the purchase order he received and I'll cut him a cheque on the spot. He obviously won't do it because the government will immediately garnish the payment to cover unpaid taxes, so we go round and round in circles with no end in sight.
It's a pretty decent chunk of cash, like 3-4 months salary. I almost feel bad for the guy but then I look at the government deduction on my pay cheque to pay for all the services that he takes advantage of for free and I get over it haha.
1) The guy is a freeman who doesn't believe in paying taxes which was unknown by the contractor until after the contract was awarded.
2) He was sent a purchase order specifically outlining the need for a GST number to receive payment.
3) Once he gets a GST # he will receive full payment.
What's the problem here? The guy is willing to pay him, once he plays by federally mandated laws. It would be no different, than me asking my employer, to pay me in full as a regular, non contracted employee, and let me worry about paying the taxes on my own. It's not going to happen.
If he hates paying tax so much, he should not have accepted the job, as having a registered GST number was disclosed to him as a condition to receiving payment, prior to starting the work. And it is obvious now, since he refuses to get that number, that he is hiding something. Any contractor that is collecting under $30k/yr in revenue in this city is either a horrible contractor, or blatantly hiding something. People working at Tim Hortons full time are earning that nowadays.
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You still aren't getting it. The guy did not ask to be paid under the table. He wrote them an invoice without a GST number which is totally normal. Even if it is mandatory for that company, it has nothing to do with tax evasion. The guy did not ask for GST without a GST number, he only wanted what he was supposed to be paid so if he's not collecting GST and under 30k then he is not evading taxes.
Or the guy could spend 10 minutes online get a BN and a GST number and multiply the invoice total by 1.05.
He has chosen not to do this simple thing for some reason.
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So they are Republicans?
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