WSIB for Ontario trades: coverage, clearances, and the one-officer exemption

If you carry on business in construction in Ontario, coverage is the starting position and the exemption is the exception. Since January 1, 2013, independent operators, sole proprietors, partners and executive officers in construction have all been treated as workers who must be covered. A partnership or corporation can exempt exactly one partner or officer, and only where that person performs no construction work at all.

The rule that costs the most money is the other one. Retain a subcontractor without a clearance certificate and you can be left with their unpaid premiums, up to the labour portion of the contract. It is one of the first things we check on a new contractor file.

The 2026 numbers

The ceiling is up from $117,000 in 2025. Your class rate is a starting point rather than your invoice, because WSIB assigns a class from your predominant business activity and then adjusts the rate for your claims experience. Check your figure on WSIB's 2026 premium rates page rather than taking it from anyone, including us. The ceiling also sits on our 2026 rates page.

Who has to be covered

Everyone performing or managing construction work, whether or not the business has employees. WSIB's expanded compulsory coverage policy puts it plainly: "Every IO, SP, partner in a partnership and EO of a corporation carrying on business in construction is a deemed worker, unless they are exempt." A one-person incorporated trade with no staff is caught. Hiring your first employee starts a 10 calendar day clock to register.

A separate exemption covers home renovation work, and it is narrower than it sounds. The work has to be on an existing private residence occupied by the person who directly retains and pays you, or by a member of their family. New builds are outside it, and the moment you are a subcontractor to a builder it is gone. It covers the individual only, so employees still need coverage. Take on work outside it and WSIB's questions and answers say you "no longer meet the criteria for exemption", with premiums due on the home renovation earnings as well for a minimum of three months. One commercial fit-out between kitchen jobs pulls the whole book of work into coverage for a quarter.

The one-officer exemption, and how people lose it

One partner in a partnership, or one executive officer of a corporation, may be exempted. Not two. The application is form 1208A, and it takes effect when WSIB receives the signed declaration.

The condition disqualifies most owners. The exempt person must perform no construction work, and WSIB defines that as "manual work of a skilled or unskilled nature, the operation of equipment or machinery, or the direct on-site supervision of workers." Periodic site visits are fine as long as you are not working while you are there.

That last item is what fails. The owner who quotes, orders material, runs the office and drives to site once a week to look at the framing is inside the exemption. The same owner who tells the crew what to do next has given direct on-site supervision, and is not. The exemption is also closed to a sole proprietor and to an incorporated independent operator, and if the exempt person's circumstances change, WSIB requires notice within 10 days. Being exempt means being uninsured, so an owner who wants protection can apply for coverage instead.

How premiums are calculated and reported

Premium is gross insurable earnings multiplied by your rate, divided by 100. Insurable earnings follow the T4 box 14 basis, capped at $121,700 per person.

Construction has its own bases for owners. An independent operator reports on the labour portion of the contract. Sole proprietors and partners report their self-employment business income. Executive officers report T4 employment income, income on a T4A, dividends on a T5 and director fees. WSIB also sets a minimum for those people, at one third of the annual maximum.

An example with real rates: an electrical contractor in class G4 with four field staff and one executive officer paid $150,000 who does no construction work.

The $28,300 of that officer's salary above the ceiling is not insurable, which is worth knowing before setting owner compensation. If the officer picks up tools, the field rate applies to their earnings instead, and the difference on $121,700 between $0.20 and $1.54 is $1,631. A business can also sit in more than one class, a showroom and an installation crew being the common case.

Reporting frequency is set by your annual insurable earnings:

You report even when payroll was nil. What you report is then measured against actual insurable earnings in a reconciliation, and WSIB's reconciliation policy prices a bad one: debit interest from July 1 of the premium year, 1 per cent of the premium per month for a late reconciliation to a maximum of $1,000 a month, and 5 per cent where earnings went unreported. An under-reported year comes back as an assessment with interest running from well before you heard about it.

Clearance certificates

A clearance is a number WSIB issues confirming a business is registered and up to date. In construction it is not optional. WSIB's clearance certificate policy says a principal who directly retains a contractor to perform construction work must obtain a clearance confirming the contractor is in good standing before the work begins, and keep it current.

Two things follow if you do not. The first is financial. The principal may be liable for the contractor's payment obligations to WSIB, up to the labour portion of the contract. On a $200,000 job with $120,000 of labour, that is the exposure you took on to save five minutes. The second is that it is an offence, with maximum penalties on conviction of a fine of up to $25,000 or six months imprisonment, or both, for an individual, and up to $500,000 for a corporation.

A clearance is valid for up to 90 calendar days and is renewable. Note the "up to", because it is not always a clean 90 days from the date of issue. Pull it before the sub starts and save it in the job file, alongside the business number you need for T5018 slips. The same check belongs on the list before you release a holdback to a sub.

One 2026 change worth knowing

The Second Injury and Enhancement Fund is closing. WSIB's SIEF policy states that "effective June 16, 2026, the SIEF is closing", with requests submitted before July 16, 2026 still processed and existing relief continuing. SIEF relief reduced the claim costs charged against an employer's experience, so without it a serious injury now flows more fully into your own rate. That makes documented safety practice and early return to work worth more than last year.

The accounting side, and one question WSIB answers differently

WSIB premiums are a deductible business expense. CRA's guidance on salaries, wages and benefits lists "workers' compensation amounts for your employees" among the employer contributions you deduct. They are not payroll source deductions. CPP, EI and income tax come off the worker's pay and go to CRA, while premiums are a cost of the business paid to WSIB on its own schedule.

Whether someone is a subcontractor for CRA purposes and whether they are covered for WSIB purposes are separate questions. The CRA side turns on control, tools, chance of profit and integration, which our subcontractor or employee check walks through. WSIB's criteria for an independent operator include having no employees and working for more than one person over an 18-month period, which the CRA analysis never asks about. A tradesperson can be a genuine contractor for income tax and still sit somewhere different for WSIB. Where a business disagrees with its classification, that goes to WSIB through its own objection and appeals process.

All of our contractors and trades work

General information only, current at August 2026. Tax rules change and GST/HST status is fact-specific. Confirm your own position before relying on anything here.