Pay Stubs for Freelancers & Self-Employed Canadians

Why Freelancers Need Pay Stubs

As a freelancer or self-employed Canadian, you don't have an employer providing pay stubs. But you still need proof of income for:

• Mortgage applications
• Rental applications
• Car loans and financing
• Credit card applications
• Child support/custody cases
• Immigration applications
• Government programs

Traditional Proof of Income for Self-Employed

Typically, self-employed Canadians provide:

1. Notice of Assessment (NOA) - Previous year's tax return summary
2. T1 General - Personal tax return
3. Business financial statements
4. Bank statements
5. Contracts and invoices

The Problem

These documents show past income, not current earnings. A mortgage lender wants to know what you're earning now, not last year.

Creating Pay Stubs as a Freelancer

Self-employed individuals can create pay stubs showing their current income:

What to Include

Your Business Information

• Business name (or your name as sole proprietor)
• Business address
• Business number (if incorporated)

Your Personal Information

• Your name
• Your address
• Your role (Owner, Principal, etc.)

Income Details

• Pay period (weekly/monthly)
• Gross revenue/income
• Business expenses (optional)
• Net income

Self-Employment Deductions

Unlike employees, self-employed people handle their own:

• CPP contributions - Both employee and employer portions (11.9% total)
• Income tax - Paid quarterly in installments
• No EI - Optional, or through self-employed EI program

Important Considerations

Be Accurate

Your pay stubs should reflect actual income. Lenders may request supporting documentation like:

• Bank deposits matching income shown
• Invoices or contracts
• Previous tax returns

Consistent Income vs. Variable Income

If your income varies, consider:

• Using an average monthly amount
• Showing individual months separately
• Providing a year-to-date total

Incorporated vs. Sole Proprietor

Sole Proprietor:

• Business income is your personal income
• Pay stub shows gross revenue and expenses

Incorporated:

• You're an employee of your corporation
• Pay yourself a salary with regular deductions
• Create standard employee pay stubs

Using Pay Stubs for Mortgage Applications

Mortgage lenders typically accept self-employed income documentation including:

1. Two years of NOAs showing consistent income
2. Current year pay stubs showing ongoing income
3. Business bank statements confirming deposits

Tips for Mortgage Approval

• Maintain consistent monthly deposits
• Keep business and personal accounts separate
• Document all income sources
• Provide explanations for income fluctuations

Using Pay Stubs for Rental Applications

Landlords want to see:

• Stable income (usually 3× monthly rent)
• Consistent payment history
• Ongoing employment/business

Your pay stub package should include:

• 2-3 months of pay stubs
• Letter confirming self-employment
• Bank statements matching income

How PaystubPRO Helps Freelancers

Create professional pay stubs showing:

• Your business as the "employer"
• Yourself as the "employee"
• Gross income
• Estimated taxes (if applicable)
• Net income

Our stubs look professional and include all standard elements that lenders and landlords expect.

Tax Implications

Creating pay stubs for yourself doesn't change your tax situation:

• Report all income on your T1 return
• Pay CPP contributions through your tax return
• Make quarterly tax installments if required

Frequently Asked Questions

Is it legal to create my own pay stubs?

Yes, as long as they accurately reflect your actual income. Falsifying income is fraud.

Do I need to deduct CPP?

Self-employed individuals typically pay CPP annually through their tax return, not through payroll deductions.

What if my income varies monthly?

You can create pay stubs showing actual monthly amounts, or use an average based on YTD totals.

Should I include GST/HST collected?

No - GST/HST is not income. Show your revenue before adding sales tax.

Start Creating Freelancer Pay Stubs

PaystubPRO makes it easy for self-employed Canadians:

1. Enter your business as the employer
2. Enter yourself as the employee
3. Input your gross income
4. Download your professional PDF

Your first pay stub is FREE - try it today!