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Does working through a staffing agency change whether I'm considered a personal services business?

TSL Written by the Treadstone Law team· Updated August 2026

Not automatically, no. Working through a staffing or placement agency adds another party into the arrangement, but it doesn't by itself change whether the underlying relationship meets the personal services business test, CRA and the courts still look at the real substance of how the work happens, examining the relationship between you, the agency, and the end client where the actual services are performed, rather than treating the agency's involvement as something that settles the question on its own.

If you work primarily through one placement, with the end client controlling your hours and how the work gets done much as an employer would, simply having an agency handle the invoicing and payment in between doesn't necessarily change that underlying reality. The agency can be a genuine intermediary in some structures, but in others, it functions more like a payroll conduit for what is, in substance, still an employment-like relationship with the client.

Because inserting a staffing agency into the chain is sometimes assumed to be a simple fix for PSB risk, and often isn't, anyone relying on this structure should look at the actual working relationship with the end client, not just the presence of the agency, to assess their real exposure.

Key takeaways

  • Working through a staffing agency doesn't automatically prevent PSB classification.
  • CRA looks at the substance of the relationship with the end client, not just the agency's presence.
  • An agency can function as a genuine intermediary or simply as a payroll conduit, depending on the facts.
  • Assess the real working relationship with the client, not just whether an agency is involved.
This is general information, not legal advice. It doesn’t create a lawyer–client relationship, and the rules can change. For advice on your situation, a Treadstone tax lawyer can help.
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