Working in Canada, Living in the USA
Moderator: Mark T Serbinski CA CPA
Working in Canada, Living in the USA
I have been offered a position with my current employer working for the Canadian business unit. I will be paid by the Canadian company in CAD, but maintain my residence in the US. I will commute across the border on a daily basis so will not have a residence in Canada and will not spend the night there except in the case of occasional business trips. Since I am a US citizen and living in the US, I know I will have US tax obligations. My question is regarding double taxation in Canada. How will that work and what should I ask for in my salary to compensate?
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nabstar
Well unlike the US, Canada taxes based on your residential ties.
Since your family, and dwelling place is in US, you will be considered a non resident of Canada. Therefore you will only pay tax on Canadian source income in Canada. Since you are working in Canada, the wages will be Canadian source, and you will be subject to tax on only that in Canada.
The US taxes based on residency, therefore since you have a green card you will have to report your world wide income, including the canadian source income. You will then get a credit for the taxes you paid in Canada.
This ensures you don't pay tax twice.
Since your family, and dwelling place is in US, you will be considered a non resident of Canada. Therefore you will only pay tax on Canadian source income in Canada. Since you are working in Canada, the wages will be Canadian source, and you will be subject to tax on only that in Canada.
The US taxes based on residency, therefore since you have a green card you will have to report your world wide income, including the canadian source income. You will then get a credit for the taxes you paid in Canada.
This ensures you don't pay tax twice.