Future Commuter - Need Confirmation

[LifesABeach]

Hi !

I am planning on moving back to Canada after enjoying a long stay (15 years) in the US.

I am a dual citizen.

I am intending on continuing my job with my current US employer, and am further planning on splitting my time between working from home (in Canada) and working from my employer's office (in the US). Where/when I do go into the office, it will be as a cross-border commuter. I will physically be in Canada every day, and in the US on those days when I do a cross-border commute into my employer's office.

So in short:
Official home address: Canada
Official work location: US
Occasional (actual) work location: Canada

Basic question first ... can this arrangement be (legally) implemented while remaining exclusively on my employer's US payroll ?

While my employer will support the arrangement, being transferred to my employer's Canadian subsidiary is a non-starter, because the drop in pay will be austere, given the variance between US and Canadian wages for my line of work. I'm also not keen on losing my US benefits, since I intend to continue relying on my current medical/dental providers in the US (hence the need for US benefits).

It's the "work from (Canadian) residence while being on US payroll" thing that has me worried.

Next, assuming it is possible to arrange all of this, my assumption is that my US employer would just keep levying the exact same income and payroll taxes they already do (Federal, State, FICA) - i.e. my "home address" should have no bearing on how I am taxed. Is this correct ?

... and what about CPP contributions that I would (not) be making. Is this permissible ?

If I'm way off-base here, would love to know before I set all kinds of wheels in motion.

(Note- am fully aware I would be obligated to file both Canadian and US taxes each year ... I've no problems with that)

Many thanks

[nelsona]

As you surmised, the only issue is with the work done while physically in canada.

Since you are commuting extensively, I would see no problem just treating your self as a daily commuter. You live in Canada and work as an employee in US. Thus FICA is all you pay; no CPP no EI. You pay IRA and state tax first on ALL the wages, and take credit for the tax on your US returns, along with FICA on your CDn return. This is how commuters, for example living in Windsor and commuting to Detroit are treated.

The line at which you are working "too much" is hard to quantify.

You *could* decide to trach your Cdn-source and US-source wages, but that gets complicated.

[LifesABeach]

Thanks Nelson for the thoughtful answer.

For some reason, I thought that a US employer (let's say based in Michigan, per your example) who wants to employ someone who BOTH lives in Canada, AND works from Canada, would not be able to have that employee on their US payroll ... i.e. to be on the US payroll, the employee needs to either: i) reside in the US, or ii) work in the US. Am I incorrect on this ?

Thanks again

[nelsona]

If you both lived AND worked in canada, indeed you would need a Cdn payroll. That ihas been made clear by CRA, and here, many times.

But you say you will work OFTEN in the US, maybe even predominately. Then it becomes a mix. Since you sated you strongly wish to remain in US payroll, for wages and benefits, I have outlined what you can do,'