Complicated cross-border tax scenario

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Posts: 4
Joined: Tue Mar 04, 2008 9:57 pm

Complicated cross-border tax scenario

Post by davesock » Wed Mar 05, 2008 12:09 pm

I have scanned through many of the posts on this message board and found a wealth of very useful information. However, I was hoping someone might be able to help me with this more complicated scenario. Here are the major points:
• I am a Canadian citizen and resident
• I am the owner (100%) of a corporation in Canada which has been invoicing a number of U.S. companies for several years
• I am a partner (approx. 1/5th ownership) and officer of a newly created American C-corp
• I am to be remunerated for the work I have been doing for the C-corp, but how these funds will be disbursed has yet to be determined
• I currently travel to the U.S. about 5-8 days per month to conduct business related to the C-corp, but am capable of exclusively telecommuting if it will simplify and/or enhance my tax strategy

My questions are as follows:
1. Is it possible for me to invoice for consulting work (through the Canadian corporation) in this scenario to avoid having to go through the trouble of a creating a separate Canadian payroll?
2. If I must be treated as a Canadian employee, can my existing Canadian corporation fill the role of the “Canadian branchâ€￾ (assuming that the costs associated with the necessary restructuring of the corporation would be less than creating, operating and filing for an entirely new one)?
3. Would I need to file U.S. taxes in either of these situations?
4. How would expenses incurred within the U.S. be handled in these situations?

Thanks in advance for any help you might be able to provide!

Posts: 4
Joined: Tue Mar 04, 2008 9:57 pm

Post by davesock » Mon Mar 10, 2008 2:42 pm

If anyone could help me with any advice on my situation, I would really appreciate it. Or perhaps my question is too involved for this forum. If that is the case, could someone recommend a new course of action?

Thank you.

Posts: 182
Joined: Wed Oct 27, 2004 1:00 pm
Location: Toronto

Post by Carson » Tue Mar 11, 2008 9:58 am

I recommend that you speak with a Canadian cross border accountant, such as Serbinski. This kind of advice takes time and therefore will cost you. I see a lot of issues, both personal and corporate.

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