How to Become an Independent Contractor Truck Driver

Have you ever wondered how to become an independent contractor? Well, this article is going to walk you through how to get started.

Independent contractors are self-employed workers who provide their own equipment and supplies, set their own hours, and are hired by a company to perform a specific job or service. While there are some limitations on what independent contractors can do for their clients, such as not being able to perform any tasks that require them to be on the client’s premises, the majority of independent contractors do not have any limitations.

To become an independent contractor, you must first register with the IRS as a sole proprietor. This means that you will be responsible for all taxes related to your work as well as reporting your income from each client separately rather than using one tax return for all sources of income. You will also need to decide whether or not you want to open up a business bank account separate from personal accounts. Finally, it’s important that you decide how much money it will take before starting out as an independent contractor—keeping accurate records and receipts is essential!

If these steps sound like something that might interest you, then keep reading for some tips and tricks for getting started!

How To Become And Independent Contractor

If you’re an enterprising person, a career as an independent contractor might be ideal for you. An independent contractor is a person or a business providing goods and services to another under a contract. Understanding the pros and cons of the profession and learning how to become an independent contractor can help you decide whether to follow this career path. In this article, we explain what an independent contractor is, outline the pros and cons, show you eight steps on how to become an independent contractor, and outline what you need to perform your duties efficiently.

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How to become an independent contractor truck driver

Follow these steps on how to become an independent contractor:

1. Identify your business structure

Determine the suitable business structure for your contracting firm. You can opt for a sole proprietorship, partnership, or a limited liability company. When choosing the best structure for your business, consider the following factors:

  • Type of industry: Some companies only contract businesses operating under a specific structure. Find out if the companies you intend to contract from require you to operate under a specific structure.
  • Costs of set-up: Find out the costs of each structure and see if you can afford it. You can begin as a sole proprietor and later change to a corporation if sole proprietorship turns out to be costly.
  • Future operations: Rules and regulations of operating a contracting business vary with provinces. When choosing the best structure, consider if there is a possibility of doing business in other provinces in the future.

2. Choose and register your business name

After identifying the suitable structure, choose a suitable business name. Using a business name may be more appealing and professional than using your own name in some circumstances. For sole proprietorship and partnership, you can run the business under your name. To register a sole proprietorship business, you need to fill a declaration of trade form and then register your trade name with the registry agent.

To register for partnership business in Alberta, follow the same process as a sole proprietorship, then fill the declaration of partnership form. When registering a corporation, use the business name report in your province to confirm that the name you have chosen is not in use. You can then complete the articles of association notice of address form and take all the information to a registry agent for incorporation.

3. Get business licenses and permit

Licenses and permits are legal requirements you need to operate your contracting business, failure to which can lead to fines or orders from authorities for you to stop operations. You can get your licenses and permits from your municipality or town office. You might also need federal or provincial permits like health and environmental permits. Business licences and permits vary with the type of industry and your location. Find out what the requirements are before starting your contracting business.

4. Get a business number and find your taxation requirements

When operating a contracting business, you need to follow tax reporting regulations set by the Canadian Tax Authority (CTA). Depending on the business you are operating, find out if you need a business number. The type of business structure you choose determines the type of taxes you pay. For instance, for sole proprietorship and partnership, you report your business income on your personal income tax returns, whereas for the corporation, you file a separate income tax return.

If you earn a salary or dividend from your business, you also need to file a personal tax return. The Canadian revenue authority requires independent contractors to keep track of all the income they receive from their freelance jobs. This ensures that the contractors pay the right amount of self-employment tax.

Related: The Best Work From Home Jobs

5. Get insurance for your business

Insurance is important for a contracting business. It mitigates the losses you might incur when running your business. You can call your insurance agent to determine the best policy for your business.

6. Establish the requirements for your workplace safety

Develop workplace safety to protect yourself and employees from injuries and the business from losses. A safety policy is a legislative requirement for all businesses. Find a copy of Occupational Health and Safety (OH&S) legislation and avail it to your employees.

7. Manage your business well

Once you have established your contracting business, the next step is to plan how to run and grow your business. Open a bank account to help you monitor your business cash flow. Develop systems that make invoicing, scheduling, and filing taxes efficient. Employees play a big role in the success of your contracting business. Develop a system to increase employee productivity and attend well to their welfare.

8. Grow your business

Develop efficient procurement measures which ensure that your clients get goods or services of the quality and quantity they need at the best possible price. Come up with marketing strategies to find more customers and enable your company to win more bids. You can try online marketing platforms to reach potential customers at fewer costs. Contact your past and existing customers who can come for repeat business or refer you to potential clients.

Network with industry players and build business relationships with them. For example, establish a relationship with procurement managers in companies you intend to contract from so that they can inform you of new opportunities. Also, register your firm in a business database and join industry associations where you can network and find opportunities. Consider looking for opportunities to pre-qualify your company for future contracts.

Related: 15 of the Best Remote Working Jobs: A Definitive Guide

What is an independent contractor?

Also known as consultants, free agents, or freelancers, independent contractors are people or businesses that do work or provide services to another as a non-employee. An individual is a freelancer if the entity benefiting from their work only directs the outcome of the work, but the entity does not engage in how the individual does the work. Unlike employees whose taxes employers deduct from their paycheck, freelancers pay self-employment tax from their income.

Becoming a contractor is an appealing opportunity for many people today. Contractors play an important role in people’s lives and the economy. Many people prefer freelancer services because they are not only accessible, convenient, and affordable, but they also provide quality services. Professionals like doctors, lawyers, dentists, and others who provide independent services fall under the category of independent contractors. Other professionals who work as freelancers include electricians, carpenters, plumbers, auctioneers, automotive mechanics, and musicians.

Related: A Beginner’s Guide to Freelance Jobs

Advantages of independent contracting

The main reason many people prefer a career in independent contracting is that they are their own boss. They choose the time, place, and how to work while ensuring they deliver quality work within the stipulated time frame. Sometimes, the contractors might work with the employees of their clients on the same project. While the employees work under supervision, independent contractors are free to work on their own.

Freelancers can potentially make more money than regular employees. This is because businesses pay more to contractors since they do not get into expensive long-term obligations with them. Contractors can reduce the self-employment taxes they pay by reducing their taxable income through permissible business deductions.

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