We understand the situation of juggling multiple jobs. With recent high inflation rates, many individuals are working for having multiple employers or transitioning between jobs to make ends meet. By the end of February, employers are required to provide employees with T4 slips, whether it be in person, via mail, or through a secure human resources site. If you have received multiple T4 slips this tax season, here’s what you need to know to manage them effectively. Don’t forget to explore our interactive T4 slip guide to understand the information on each line!

Having Multiple Employers and Tax Considerations.

If you have multiple jobs, it’s important to consider the total income you earn from all sources. Combining your earnings may put you in a different tax bracket, potentially resulting in a higher tax liability compared to previous years.

Each of your employers deducts taxes from your pay, but the tax calculation formula includes the basic personal amount. This amount represents the minimum income threshold before you start paying income taxes, having multiple employers currently set at $15,000. Unless you inform one of your employers that the basic personal amount has already been accounted for by your other employer, both employers will assume it hasn’t been claimed. As a result, $15,000 of income may go untaxed, leading to a significant tax bill. When starting a new job, you receive a Form TD1 Personal Tax Credits Return (federal and provincial) where you must indicate to your second (and subsequent) employer(s) that you cannot claim the basic personal amount on that particular income.

If you work in multiple provinces, it’s crucial to understand the credits and benefits you are eligible for and account for them when filling out your Form TD1. This ensures that you don’t “double dip” on credits and helps you avoid a substantial tax bill when tax season arrives.

Income Mix and Self-Employment

If you have a combination of T4s from employers and income from your own side hustle, it’s crucial to report all of your income. Most side hustles won’t provide you with a T4 because you essentially function as your own employer. However, if you work for companies like Uber or SkipTheDishes, they will furnish you with an annual statement having multiple employers that can support your tax filing. Unlike a T4, this information is not shared with the government.

Understanding what you can claim as a business expense is also important. For instance, if you drive for Uber, you may be eligible to claim expenses such as gas used for driving purposes, car washes, having multiple employers, winter tire installation, and other car maintenance expenses (usually calculated as a percentage of kilometers driven for business purposes versus personal use).

To file as a self-employed individual, you will need to complete the Statement of Business or Professional Activities using forms T2125 and TP-80. Keep in mind that there is no tax withheld from your self-employment earnings. Therefore, it’s advisable to set aside a suitable amount throughout the year to cover the taxes you are likely to owe having multiple employers. If you owe more than $3,000 in taxes by the end of the year, you will be required to make instalment payments towards the following year’s taxes.

Self-employed individuals have until June 15 to file their taxes. However, if you owe taxes, the payment is due by May 1, 2024.

Also read: Blogger Tax Deductions: Do’s and Don’ts

Reporting Cash or Tip Income.

If you’re earning income in cash or receiving tips without a T4 slip, it’s still essential to declare that income on your taxes. Line 10400, “Employment income not reported on a T4 slip,” is where you indicate to the government the amount you earned in cash or through non-reported payments. In Quebec, workers declare their tips at the end of each pay period by providing their employer with Form TP-1019.4.V Register and Statement of Tips. For individuals outside of Quebec, it’s advisable to keep a daily having multiple employers or biweekly tally, spreadsheet, or tracker of the tips earned to ensure an accurate representation of your earnings.

While the government may not have a record of cash tips (except in cases where employers include mandatory service charges on clients’ bills, which will appear on your T4 slip), they have a general understanding of how much you should be earning based on factors like hours worked, industry, and location. Therefore, it’s crucial to be as accurate as possible when reporting your income. Additionally, remember to keep your tracker or records for at least 6 years in case you receive a Notice of Assessment from the government for having multiple employers.