Canadian citizen working in Canada for US co.

JC898 · Post by **JC898** » Wed Oct 27, 2004 1:43 pm

I (Canadian citizen, non-US citizen) worked in the US on a TN visa for 4 years and have recently returned to Canada (TN still valid). My US employer (does not have a Canadian side) wants me to keep working for them from Canada, no commuting involved. I would be working remotely via phone and computer. They have told me that their HR dept has spoken with their lawyers and that when my current TN expires I will not need to get a new one, I can simply continue to work. I have many concerns about this and I am not sure what they have told me is correct. Also, I have many questions regarding tax deductions, salary payment. Is the information they have provided nearly correct? Where would I pay taxes? Would they have to not withdraw taxes in the US and instead I would pay in Canada? Any hints will be appreciated.

Nelson · Post by **Nelson** » Wed Oct 27, 2004 1:44 pm

As soon as you leave US, you don't need or use TN.
You would only need TN (possibly) if you occasionally go to US to work in the office.

They are required to set up a Cdn payroll for you, so that they will pay their share of EI and CPP, and withhold your share of EI, CPP, Fed and Prov taxes. You shouldn't have any more US tax concerns at that point, and should not be on US payroll.

JDC · Post by **JDC** » Wed Oct 27, 2004 1:46 pm

How difficult is it for a U.S company to set up CDN payroll? I am considering employment with a U.S company as a remote employee at my home office in Canada.

Nelson · Post by **Nelson** » Wed Oct 27, 2004 1:48 pm

Very simple.
There are outfits in canada that do this.

JDC · Post by **JDC** » Wed Oct 27, 2004 1:48 pm

Thank you...knowing that will be helpful to me.

JC898 · Post by **JC898** » Wed Oct 27, 2004 1:49 pm

What about the employee him/herself? Does one continue to work as a regular employee and simply file taxes in Canada? What about benefits? Are all these things that need to be negotiated with the employer again? Do you know of any of these outfits that would do this in Canada?

Nelson · Post by **Nelson** » Wed Oct 27, 2004 1:50 pm

As a Cdn-based employee, he would have no taxes to report in US.
As to benefits, these would have to be negociated, as many benefits offered to US employees (exhorbitant health care plans, 401(k), etc) simply don't apply in Canada, and are of no benefit.

Whomever the company contracted out to do the Cdn payroll would surely advise them on what a 'normal' compensation package would entail.

There are names in some posts below. Search there or on the web.

Carson · Post by **Carson** » Wed Oct 27, 2004 1:50 pm

One other thing to keep in mind is that a US company that has a Canadian employee is considered to have a permanent establishment in Canada. This will necessitate Canadian corporate tax filings, an Extra-provincial licence to conduct business in the province where the branch office is located.
In other words, this will be a big headache and additional accounting fees to do all the filings correctly. This is why most US companies prefer to hire a "consultant", rather than have employees across the border.