Consultant & Freelancer Accounting
Self-employment income, expenses, instalments and incorporation decisions for independent professionals.
For an independent consultant the two questions that decide the tax outcome are whether you are genuinely self-employed rather than an employee of your main client, and whether incorporating buys enough deferral to justify two corporate returns.
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Key facts
| Sales tax | Registration required once taxable supplies exceed $30,000 over four consecutive quarters |
|---|---|
| Quick Method | Often advantageous for low-input service businesses; some professions are excluded |
| Personal services business risk | A one-client incorporated consultant can be reassessed, losing the small business deduction |
| Unincorporated filing | June 15 to file, April 30 to pay |
| Authorities | Canada Revenue Agency and Revenu Québec |
Independent consultants and freelancers wear every hat — including bookkeeper. A&S Financials takes the finance side off your plate: tracking income and expenses, filing your self-employment taxes, and advising on whether and when to incorporate. We help you keep more of what you earn while staying fully compliant.
Book a consultationHow we help
- Self-employment income and expense tracking
- Home-office and vehicle deductions
- GST/QST registration and filing
- Instalment planning
- Incorporation timing and analysis
- Personal and business tax preparation
The personal services business risk is the one that hurts
An incorporated consultant who works for essentially one client, under that client's direction, in a way that would look like employment but for the corporation, can be assessed as a personal services business. The consequences are severe and asymmetric: the small business deduction is denied, an additional tax rate applies, and almost no deductions are permitted beyond salary paid to the incorporated employee. It is materially worse than either being an employee or being properly self-employed. What protects against it is the same evidence that establishes independence generally — multiple clients, your own tools and premises, control over how and when the work is done, a real chance of profit and a real risk of loss, and contracts that reflect all of that.
The Quick Method usually suits a consultant
You continue charging GST and QST normally. The difference is on remittance: instead of tax collected less input tax credits, you remit a lower prescribed rate applied to tax-included revenue and stop tracking credits on operating expenses. That arithmetic favours a business whose costs are mostly your own time — which describes most consultants. It works against a business with substantial taxable purchases, because the credits given up exceed the rate reduction. Certain professions are excluded outright, including accountants and lawyers. Capital purchases such as equipment remain separately claimable, so a large purchase does not have to be forgone.
Frequently asked questions
Should I incorporate as a consultant?
How do I avoid being treated as an employee?
Is the Quick Method worth electing?
What can I deduct for a home office?
Speak with a Montréal CPA
Contact us to discuss your accounting and tax needs — in the language you prefer.