T5018 Filing for Ontario Contractors: Who Files, When, and What Missing It Costs
- Jul 30
- 6 min read
Updated: 5 days ago
Last reviewed: July 2026
A T5018 is the information slip Canadian construction businesses file to report what they paid their subcontractors. If more than half of your business income comes from construction and you paid a subcontractor more than $500 for construction services, you have to file one. The return is due six months after the end of your reporting period, and late filing carries per-slip daily penalties.
That is the whole rule. The rest of this page is the detail, the four places Ontario contractors get it wrong, and what a T5018 gap signals to a CRA auditor.
T5018 at a glance
Question | Answer |
What is it | T5018, Statement of Contract Payments. An information slip, not a withholding slip |
Who files | Businesses with more than 50% of income from construction activities |
Reporting threshold | More than $500 paid to a subcontractor in the reporting period, before GST/HST |
Amount reported in box 22 | Includes GST/HST and PST |
Reporting period | Your choice of calendar year or fiscal period, applied consistently |
Filing deadline | Six months after the end of the reporting period |
Late penalty | From $10 per day for 1 to 50 slips, capped at 100 days, scaling to a $7,500 maximum |
Non-resident subs | Reported on a T4A-NR instead, not a T5018 |
What is a T5018 slip?
A T5018 is an information slip that reports payments made to a subcontractor for construction services during a reporting period. You issue one slip per subcontractor and file a T5018 Summary that totals them.
It is a reporting slip, not a withholding slip. No tax is deducted from the subcontractor's payment.
The CRA matches the amounts on your slips against the income your subcontractors report. That is the entire purpose of the program. If a subcontractor billed a contractor $80,000 and declared $30,000, the mismatch surfaces automatically.
Who has to file a T5018?
A business must file T5018 slips if all three of the following are true:
More than 50% of its business income comes from construction activities. This is an income-mix test, not a job-title test
It paid a Canadian-resident subcontractor for construction services during the reporting period
Total payments to that subcontractor exceeded $500, measured before GST/HST
Construction activities cover the obvious trades and the less obvious ones: erection, excavation, installation, alteration, modification, repair, improvement, demolition, destruction, dismantling and removal of a structure or any part of it.
Applied to real Ontario businesses: a general contractor files. A residential renovator files. An electrical or HVAC company that subs out work files. A property management company whose income is mostly rent does not file, even though it hires trades constantly.
Where Ontario contractors get T5018 filing wrong
Four errors account for almost every T5018 problem our team corrects.
"My subcontractor is incorporated, so no slip is needed." Incorrect. Corporations, partnerships and sole proprietors all receive T5018 slips. The subcontractor's business structure is irrelevant to the filing requirement.
"The reported amount goes in before HST." Incorrect, and this is the most common mechanical error. The $500 threshold is measured before GST/HST. The amount reported in box 22 includes GST/HST and PST. Two different numbers doing two different jobs.
"It was mostly materials, so it does not count." Payments for goods only are not reportable. But when an invoice covers labour and materials together, the full payment is reportable. There is no requirement to split it out.
"My subcontractor is in the United States." Payments to non-resident subcontractors do not belong on a T5018. They go on a T4A-NR, which carries its own rules and possible withholding obligations. Different form, different consequences for guessing.
A fifth one is worth naming plainly. Cash payments are still reportable. Unreported cash in construction is one of the oldest audit targets the CRA has, and the trail exists in bank withdrawals and job costing whether or not an invoice was issued.
When is the T5018 deadline?
The T5018 return is due six months after the end of the reporting period.
The reporting period is the payer's choice of either the calendar year or the business fiscal period. Once chosen, it has to be applied consistently, and changing it later requires CRA permission.
Reporting period ends | T5018 return due |
December 31 (calendar year) | June 30 |
September 30 | March 31 |
June 30 | December 31 |
March 31 | September 30 |
Most owner-managed construction corporations use the fiscal period, because the subcontractor data is already being assembled for the year-end anyway. The six-month window feels generous in month one and vanishes in month five.
What are the penalties for filing a T5018 late?
Penalties are calculated per slip and per day. For 1 to 50 slips the penalty is $10 per day, capped at 100 days, so a maximum of $1,000. The scale climbs with the number of late slips to a maximum of $7,500.
The dollar figure is survivable for most contractors. The larger cost is what the gap signals.
Missing information returns tell a CRA auditor the subcontractor file is loose, and the subcontractor file is precisely where a construction audit goes next: worker classification, input tax credits claimed on subcontractor invoices, and whether those subcontractors were HST-registered at all. Clean T5018 filings are inexpensive insurance and the fastest available
proof that the records are in order.
How to make T5018 filing a non-event
Contractors who never think about T5018s all do the same thing. They collect the information at onboarding instead of at year end.
Before a new subcontractor receives a first payment, collect:
Full legal name and operating business name
Business Number or SIN
Business address
HST registration number, verified as valid
WSIB clearance certificate
Enter it in QuickBooks Online as a vendor record with the tax ID populated and the vendor flagged as T5018-eligible. The slips then become a report you run rather than a search through eight months of invoices.
Chasing a subcontractor for a Business Number in February, after the job closed and the crew moved on, is a genuinely miserable way to spend a week.
While the file is open, it is worth confirming that each of those people is correctly treated as a subcontractor rather than an employee, because that question carries far more exposure than a late slip does.
Frequently asked questions
What is a T5018 slip?
A T5018, Statement of Contract Payments, is an information slip reporting payments made to a subcontractor for construction services. Canadian construction businesses file one slip per subcontractor plus a summary, and the CRA uses them to match reported subcontractor income.
Do I need to file a T5018 if I used only one subcontractor?
Yes. If more than 50% of your business income is from construction and you paid that subcontractor more than $500 for construction services, one slip is still a filing requirement.
Does the $500 T5018 threshold include HST?
No. The $500 threshold is measured on payments before GST/HST. The amount reported on the slip itself does include GST/HST.
Do I file a T5018 for an incorporated subcontractor?
Yes. The requirement applies to all Canadian-resident subcontractors whether they operate as a corporation, a partnership or a sole proprietor.
When is the T5018 due?
Six months after the end of your reporting period. A December 31 year end means June 30. A September 30 year end means March 31.
What happens if I file a T5018 late?
Penalties start at $10 per day for 1 to 50 slips, capped at 100 days, and scale to a maximum of $7,500 depending on how many slips are late. Late filing also flags the subcontractor file for closer CRA review.
Do I have to give the T5018 slip to my subcontractor?
There is no requirement to send the slip to the subcontractor, unlike a T4. Many contractors do it anyway because it prevents later disagreements about what was paid.
What if I missed T5018 filings for prior years?
File them. Correcting voluntarily before the CRA makes contact is always cheaper. Bringing several years together as one cleanup keeps the record consistent.
Key takeaways
The T5018 test is a 50% construction income mix, a Canadian-resident subcontractor, and more than $500 paid before GST/HST
The threshold excludes HST, the reported amount includes it
The deadline is six months after your reporting period ends, calendar year or fiscal, your choice, applied consistently
Penalties run per slip per day to a $7,500 maximum, and a gap invites a wider look at the subcontractor file
Collecting Business Numbers, HST numbers and WSIB clearances at onboarding turns year-end filing into a five-minute report
Talk to an accountant who works with contractors
SKG Financial handles corporate tax, bookkeeping, HST and payroll for construction and trades corporations across Mississauga, Oakville, Vaughan, Markham, King City, Caledon and Burlington. T5018 filings, subcontractor compliance and HST on subcontractor invoices are routine work here, not a research project. If you are running a construction corporation and want the T5018, the holdbacks and the corporate return handled by the same people, that is what our contractors practice does.
Fixed fees quoted up front. Year-round support, not one rushed conversation at year end.
Official CRA references: T5018 slip, Statement of contract payments and when to file information returns. This page is general information, not advice for a specific situation.
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