Narjes Justification Letter — Spousal Wage Payments
Owner: Mahdi Moradi Status: Draft Version: 1.0.0 Last Updated: 2026-03-19 Applies To: Bornara AI
Purpose
This document serves as the CRA justification letter for wage payments made to Narjes (spouse) by Mahdi Moradi's sole proprietorship, Bornara AI. It provides the rationale, scope of work, and evidence supporting the reasonableness of listed wages as a deductible business expense under CRA guidelines.
Disclaimer: This is an internal record for CRA documentation purposes. Consult a qualified Canadian tax professional for advice specific to your situation.
Justification Statement
To Whom It May Concern,
I, Mahdi Moradi, operating under the trade name Bornara AI as a Canadian sole proprietorship, employ my spouse Narjes Ali Ahmad in a legitimate operational capacity within my business. This letter details the nature of her work, the basis for her compensation, and the evidence supporting these payments as reasonable business expenses.
Employee Details
| Detail | Description |
|---|---|
| Full Name | Narjes Ali Ahmad |
| Relationship | Spouse |
| Role | Designer, Administrator, Social Media Manager |
| Start Date | Q1 2026 |
| Time Commitment | 5–10 hours per week |
| Pay Rate | $20–$30 per hour |
| Estimated Annual | $5,200–$15,600 |
| Payment Method | E-transfer (preferred) or cash with signed receipts |
Scope of Work
Narjes performs the following business functions that are essential to the operation of Bornara AI's four revenue streams:
| Category | Specific Tasks |
|---|---|
| Graphic Design | Logo creation, branding materials, product images, social media templates |
| Photography | Product photography for gifts, cookies, and packaging |
| Shopify Operations | Theme customization, collection layouts, product descriptions |
| Social Media | Content creation, daily posting, community engagement |
| Administration | Email management, scheduling, receipt organization |
| Customer Service | Responding to orders, inquiries, and complaints |
| Supplier Comms | Communication with vendors and suppliers |
| Cookie Business | Recipe development, packaging design, quality control |
| AI Platform | UI/UX feedback, user testing, design review |
Reasonableness of Compensation
Market Rate Comparison
| Role | Canadian Market Rate | Narjes' Rate |
|---|---|---|
| Freelance Graphic Designer | $25–$60/hour | $20–$30/hour |
| Social Media Manager | $20–$45/hour | $20–$30/hour |
| Administrative Assistant | $18–$28/hour | $20–$30/hour |
| Product Photographer (freelance) | $30–$75/hour | $20–$30/hour |
Narjes' compensation is at or below market rate for the work performed, satisfying CRA's requirement that wages paid to family members reflect fair market value.
Volume of Work
At 5–10 hours per week (260–520 hours annually), the compensation falls within the range of $5,200–$15,600 per year. This is consistent with a part-time role in a small business and is well below the basic personal amount (~$15,705 for 2026), meaning Narjes would pay minimal or no income tax on these earnings.
Documentation Maintained
The following records are kept for each payment period as per CRA requirements:
- Weekly timesheets — Date, hours worked, specific tasks performed
- Signed payment receipts — For each payment (see template in CRA Templates)
- E-transfer confirmations — Screenshots showing date, amount, and recipient
- Task log entries — In the business activity log
- Work samples — Designs, social media posts, photographs created
CRA Compliance Basis
Under CRA guidelines for deducting wages paid to family members:
- The work is real and necessary — Narjes performs essential design, admin, and operations tasks that would otherwise need to be outsourced
- The wage is reasonable — At or below market rate for equivalent freelance work
- Payment is documented — E-transfer records and signed receipts for every payment
- Time is tracked — Weekly timesheets with specific tasks logged
- The work is actually performed — Work products (designs, posts, photos) serve as evidence
Tax Impact
| Party | Impact |
|---|---|
| Business | 100% deductible as wages expense (T2125 Line 8960) |
| Narjes | Reports as employment/other income on her T1 personal return |
| Net Tax | Below ~$15,000 annual, minimal or $0 tax owed by Narjes |
Related Documents
- Team & Family Roles
- CRA Templates — Signed receipt template
- CRA Compliance Guide — Documentation folder structure
- Expense Tracking Guide — Wage tracking procedures
- Tax Optimization Plan