Know the Facts The underground economy typically involves commercial activity that is unreported for tax purposes. It is of concern to the CRA, as well as all provincial, territorial and municipal jurisdictions, and all lawabiding businesses and individuals across the country. Underground economic activity is particularly prevalent in industry sectors where cash transactions are common, such as hospitality, automotive repairs and construction, including home renovations. Tree services can fall into this category. It is a myth that operating in cash and failing to keep records makes you immune to taxes. If your lifestyle is not in line with the income you report, and you cannot explain the difference, the CRA can assess taxes based on indirect or alternate methods of calculating your income. Evading taxes is illegal and can result in criminal convictions leading to fines and jail time in addition to any taxes and penalties owing under the Income Tax and Excise Tax Acts. The CRA publicizes criminal convictions in the newspapers and on its Web site. Why you should not support those who participate in the underground economy The underground economy hurts all Canadians. Those who participate in the underground economy avoid their tax responsibilities at your expense, and place an unfair burden on all law-abiding taxpayers. Unpaid taxes mean less money for programs, such as health care, childcare, employment insurance and pensions. The underground economy also undermines the competitiveness of businesses and individuals because it offers an unfair, illegal advantage to those who fail to comply with Canada's tax laws. It undermines the integrity of our tax system. This is why legitimate tree service companies have a difficult time competing with many of their competitors. Please DO NOT support the illegitimate operators. Please obey the law. For consumers, paying "under the table" for a job is not a better deal. If you pay cash you have no warranty, no recourse for poor workmanship, and the added risk of liability if an injury takes place on your property.
How to protect yourself Before you hire anyone be sure to ask a lot of questions, make sure a written contract is in place, and ask for proof of Workers' Compensation or equivalent private liability insurance to cover injury as well as any damage that could occur in your home. This will protect you from being liable for an injury in your home, as well as damage to your home, and to the worker's equipment. Any and all legitimate tree service companies will have: a) Adequate liability insurance – and can have a Certificate of Insurance sent to you b) Workers Compensation – and have an account number to prove it c) An HST number Information is the key. Know the businesses and individuals with whom you are dealing, and use the information at your disposal, including this Web site to recognize those who are participating in the underground economy A "Get it in Writing� brochure has been collaboratively authored by the Canadian Home Builders' Association and Canada Mortgage and Housing Corporation. The brochure is a source of information for Canadian consumers and provides insights on the risks of dealing with "under the table" contractors in the construction sector. For more information, visit: http://www.hiringacontractor.com. Hire ONLY legitimate tree service companies. I know it costs a little more, but those tax dollars are what makes Canada and Ontario one of the better places in the world to live. Do NOT forget that.