Vending route payroll: what your first hire actually triggers

Solo operators: your only payroll question is you

A one-person route has no payroll. Sole proprietors take draws — there is no mechanism for paying yourself a wage and no reason to want one. If you have incorporated, you have a real choice: dividends need no payroll apparatus at all, while salary requires a CRA payroll account, remittances, and a T4 even for a company of one — but it builds RRSP room and CPP credits in return. We model that mix once a year as part of the year-end, not as a standing payroll engagement, because selling a solo operator full-service payroll would be selling them nothing.

The first hire triggers more registrations than most operators expect

The day the route outgrows you, the obligations arrive as a bundle, roughly in this order:

• CRA payroll account — an RP number added to your business number before the first remittance falls due.
• TD1 forms — federal and Ontario, signed before the first pay so withholding starts right.
• WSIB registration — generally within 10 days of hiring your first worker.
• CPP and EI — EI from the first dollar; CPP above the $3,500 annual basic exemption, prorated across pay periods.
• Remittances — due the 15th of the following month, though many new employers withholding under $1,000 a month qualify to remit quarterly.

What usually does not arrive: Employer Health Tax. Ontario's exemption covers the first $1 million of payroll for eligible private employers — more payroll than almost any vending route will ever run. We set the bundle up once, correctly, in a week.

One rule that surprises small employers: public holiday pay applies to part-timers from the start. The ESA formula — wages earned in the four work weeks before the holiday, divided by 20 — owes your six-hour-a-week helper a small amount for Canada Day whether or not they work it, and it is the line item first-time employers miss most often.

Route drivers: vehicles and cash are the two live issues

Pay the vehicle correctly. A driver using their own car should get a per-kilometre allowance at CRA's reasonable rates, backed by a route log — done that way it stays off the T4, while a flat monthly car allowance is taxable income. A company van keeps things simpler as long as it stays a work vehicle; personal use creates a taxable benefit that has to be calculated, not ignored.

Cash is the second issue, and the rules are stricter than most owners assume. You cannot simply dock a driver's pay for a shortage: Ontario requires specific written authorization for any such deduction, and no deduction is allowed at all where anyone besides that driver had access to the cash — which on a shared route is nearly always. The fix is controls, not clawbacks: counted floats, per-machine collection records, and cashless telemetry that reconciles vends to deposits, the same data spine our vending bookkeeping runs on.

Who ends up on a route payroll

Keep payroll as small as the business

Honesty about scale: a route with one part-time helper needs a few hundred dollars a year of payroll administration done correctly, not a platform subscription and a monthly service call. We size the engagement to the roster — often just remittances, year-end T4s, and a classification check whenever the roster changes — and it grows only when the route does. Machines imported from the US, and the route-investor pitches that tend to come with them, are purchase and tax questions rather than payroll ones; those live on our cross-border page for vending operators. Engagement scope and fixed fees are on the payroll services page.

Source: CRA — Payroll.