CTOA calls for an immediate review, trucking-specific guidance, and fair treatment of genuine small businesses facing tax bills of up to $100,000
Mississauga, ON, July 10, 2026 — The Canada Truck Operators Association (CTOA) is calling on the Canada Revenue Agency and the federal government to urgently review how personal service business (PSB) enforcement is being applied to incorporated trucking owner-operators.
CRA has confirmed it is running a focused compliance program addressing personal service businesses and fee-for-service reporting in the trucking sector. CRA spokesperson Benoit Sabourin said in a statement this week that Budget 2025 provided funding to lift a moratorium on assessing penalties for failure to report fees-for-service transactions in trucking, and to implement a focused program addressing non-compliance related to personal service businesses.
CTOA supports appropriate tax enforcement. However, the association is concerned that legitimate owner-operators — who own or lease commercial trucks, pay substantial operating expenses, and assume genuine business risk — may be getting caught in enforcement action intended for improper arrangements.
Scale of the issue
In the past week alone, CTOA has received more than 50 reports from incorporated owner-operators and small trucking businesses saying they have received CRA review letters or reassessment notices connected with possible PSB status. Some businesses remain in the initial information-review stage; others report having already received reassessments. Reassessment amounts reviewed by CTOA range from approximately $50,000 to $100,000 per case.
One notice reviewed by CTOA involves an incorporated owner-operator who has worked in the trucking industry for approximately 10 years. The notice shows a total reassessed balance of $91,580.75, with full payment requested by July 13, 2026, to avoid further interest. The operator asked not to be identified, citing concern that speaking publicly could result in additional scrutiny.
As reported by trucknews.com, a separate Ontario owner-operator case involved a reassessment of approximately $130,000 after fuel, repair, and other operating expenses were disallowed; the operator’s representative said CRA auditors appear to be placing significant weight on the fact the operator hauled for a single carrier. Accountants have also told trucknews.com they are seeing similar CRA reviews of incorporated owner-operators, including cases where businesses show clear signs of genuine operations — commercial trucks worth hundreds of thousands of dollars and substantial fuel, repair, and insurance expenses.
“This is no longer a handful of isolated tax files,” said Tejpreet “Tej” Dulat, spokesperson for the Canada Truck Operators Association. “CRA has confirmed there is a focused trucking compliance program, and legitimate small businesses are now reporting potentially devastating consequences.”
CTOA supports enforcement, but it must be accurate
CTOA supports tax compliance, worker protection, road safety, and enforcement against deliberate worker misclassification. The association’s concern is specific: genuine trucking businesses must not be treated as incorporated employees merely because they work with one principal carrier at a time.
CRA has stated it does not rely on a single factor when determining whether a corporation is operating a PSB, and that it examines the complete facts of each relationship, with truck ownership or control under a lease arrangement being one of many factors considered. CTOA is concerned, however, that reports from owner-operators and tax professionals suggest that working with one carrier may be receiving disproportionate weight in some reviews, while other business factors are not being fully recognized — including:
- ownership or commercial leasing of the truck
- substantial capital investment
- responsibility for fuel, repairs, tires, insurance, and maintenance
- exposure to breakdowns, downtime, and financial loss
- the ability to hire another qualified driver
- the ability to leave one carrier and contract with another
- responsibility for managing business expenses
- the opportunity to earn a profit or suffer a loss
“An individual driving a carrier-owned truck after being required to incorporate is fundamentally different from a business owner who purchases a commercial truck, pays all operating expenses, assumes the risk of breakdowns and lost revenue, and may hire another qualified driver,” said Dulat. “CRA enforcement must recognize that distinction.”
Why many owner-operators work with one carrier
CTOA says working with one carrier at a time is common in legitimate owner-operator arrangements because of how trucking operates in practice. An owner-operator may work within a carrier’s operating authority, commercial insurance system, permits and licensing structure, safety and compliance program, customer network, dispatch system, and established freight lanes. Moving between carriers can require new insurance approvals, safety onboarding, equipment inspections, plates, permits, and customer authorization — while the owner-operator continues to own the truck, pay for fuel and maintenance, manage operating expenses, and carry substantial financial risk.
“Working with one carrier does not automatically make a trucking business an employment relationship,” said Dulat. “Long-standing owner-operator relationships are part of how freight actually moves across Canada.”
A growing concern for carriers as well
CRA has indicated its compliance work also examines whether companies engaging incorporated service providers are meeting their own tax-reporting obligations — meaning consequences may extend to carriers that have responsibly relied on established owner-operator business models for years.
“Uncertainty of this magnitude is not good for owner-operators, carriers, customers, or the Canadian economy,” said Dulat. “Businesses cannot plan or invest with confidence when established commercial relationships may later be reclassified without clear industry-specific standards.”
Why this matters beyond individual tax cases
Canada’s trucking sector is overwhelmingly made up of small businesses. Federal industry data indicates that micro-businesses with one to five employees account for approximately 83.4 per cent of employer establishments in the trucking sector, and businesses with fewer than 100 employees represent approximately 99.5 per cent of Canada’s trucking business landscape.
“A reassessment of $50,000, $90,000, or $100,000 can put a family-owned trucking business under,” said Dulat. “Most owner-operators do not have internal legal departments, tax litigation teams, or the financial reserves required to challenge CRA for months or years.”
The industry is already under pressure from insurance premiums, equipment and repair costs, financing expenses, tariffs, fuel costs, and ongoing economic uncertainty. CTOA warns that if genuine owner-operator businesses are pushed out of the market, the consequences will be felt by carriers, shippers, brokers, manufacturers, retailers, farmers, and consumers.
“Small trucking businesses are not separate from the supply chain, they are the supply chain,” said Dulat. “Less capacity and less competition eventually mean higher transportation costs and higher prices for goods.”
What CTOA is asking for
CTOA is calling on CRA and the federal government to:
- Conduct an urgent national review of how PSB rules are being applied to incorporated trucking owner-operators
- Publish clear, trucking-specific guidance distinguishing genuine equipment-owning businesses from incorporated employment arrangements
- Confirm publicly that working with one principal carrier is not, by itself, determinative of PSB status
- Require a senior technical review before reassessments are finalized against businesses that own or commercially lease trucks and incur substantial operating expenses
- Temporarily pause the finalization of disputed PSB reassessments involving genuine equipment-owning owner-operators while the program’s application is reviewed
- Create a specialized CRA review team with an understanding of trucking operations, including operating authority, insurance, dispatch, permits, equipment ownership, and owner-operator agreements
- Introduce a one-year education and transition period where long-standing industry arrangements are found to require changes
- Avoid punitive retroactive treatment where expectations or industry-specific guidance were unclear
- Consult directly with owner-operators, small carriers, tax professionals, shippers, brokers, and fleets that responsibly use owner-operator services
- Provide a fair and accessible review and objection process for small businesses that believe they have been incorrectly classified
“Enforce the law, but apply it accurately and fairly,” said Dulat. “Do not allow legitimate, capital-intensive trucking businesses to become collateral damage in an enforcement program that may not fully understand how the owner-operator model works. Crack down on abuse, but do not crush genuine small businesses.”
CTOA is asking owner-operators and small carriers who have received CRA review letters, reassessment notices, or personal service business-related communications to contact the association confidentially. CTOA will not publish company names, CRA account details, or identifying information without permission.
Confidential case submissions: info@thectoa.ca
Media Contact
Jas Kaur
Canada Truck Operators Association
jas.kaur@thectoa.ca
416-443-0042
theCTOA.ca
About CTOA
The Canada Truck Operators Association represents small and mid-sized carriers, owner-operators, drivers, and trucking businesses across Canada. CTOA advocates for road safety, fair and consistent enforcement, compliance education, evidence-based public policy, and the protection of legitimate small businesses operating within Canada’s trucking sector.