Question

The 17-year-old son of an employee has been doing handyman work for the business for a period during the school vacation. He has supplied an invoice for $115.00 for the work he has completed. He is not registered for nor has he charged GST. Is there a withholding requirement?

Answer 1

1. A minor (under the age of 18 years), is also subjected to tax, if the earned income is above the standard deduction limit (6350$ in 2017). This standard deduction is increased to $12000 in 2018.

2. When the earned income is more than the above limit, tax liability arises and also the withholding tax requirement.

3. Merely because, you are a student, it does not automatically exempt you from withholding tax. A minor can qualify for exemption from withholding, if he proves that he only works for part time only during vacation and the income is less than the standard deduction limit. He has to submit form W-4 to the deductor.

4. If the above conditions are satisfied, the withholding tax requirements are not applicable to the minor.