T5018 slips: when construction businesses must report payments to subcontractors
If more than half your business income is from construction, you must report payments over $500 a year to each resident subcontractor on T5018 slips, within six months after the period ends.
Small renovation companies often find out about the T5018 requirement when CRA asks for missing slips. The rule is simple once you know it, and the records it needs are the same ones you need for any audit.
Who must file
You must file if more than 50% of your business income comes from construction activities and you paid Canadian-resident subcontractors for construction services, whether the work was done in Canada or abroad. Payments only to non-resident subcontractors do not need a T5018.
Which payments
CRA's current guidance requires a slip when the total payments to a subcontractor in the reporting period are more than $500, not including GST/HST. Payments only for goods do not need a slip; for mixed payments, look at the service part. Older CRA material used slightly different wording, so follow the current page.
When to file
The T5018 return is due six months after the end of the reporting period. For a calendar-year reporting period, that is June 30 of the following year; you can also report by fiscal period.
How to file
File the T5018 slips with the T5018SUM summary, or your own form if it contains all the required information and a list of total payments to each subcontractor.
Records that make it easy
Keep each subcontractor's legal name, address and business number or social insurance number, and invoices that separate labour or services from materials. Ask for these before the first payment.
Prevention Checklist
- Check whether construction is more than 50% of your business income.
- Collect each subcontractor's name, address and business number before paying.
- Track yearly totals per subcontractor, excluding GST/HST.
- Separate services from goods on invoices.
- File slips and the T5018SUM within six months after your reporting period.
References
- Canada Revenue Agency. T5018 slip - Statement of contract payments, Web page, Who files, $500 threshold, goods vs services, forms. Accessed 2026-11-01.
- Canada Revenue Agency. T4002: Self-employed Business, Professional, Commission, Farming, and Fishing Income, Chapter 1, Web page, T5018 filing deadline. Accessed 2026-11-01.
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General information based on the official sources listed above, not legal, tax or engineering advice. Rules change; check the source or ask a qualified professional before you act.
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