Canadian Working in USA - Company never withheld Taxes! Help

njasonjohnson · Post by **njasonjohnson** » Sun Jan 15, 2012 1:07 am

Iâ€™m a Canadian citizen living in Nova Scotia, Canada.
I work for an international company (UK) that has an office based in the Calgary, Canada. I am a direct employee of this company. I get paid from the Canadian Office in Canadian Funds.
Iâ€™ve been working for them for 9 years and in 2010 & 2011 worked in the USA for a portion of my income.

â€¢ 93 Days in 2010 in the USA.
â€¢ 155 days in 2011 in the USA.

My company withheld taxes for the Canadian government only and issued me a T4 only. I was told that they did not have to withhold US taxes because of the Canada-USA tax treaty. It appears that they are in some tax trouble with the IRS. It is my understanding that they should have withheld taxes proportional for the amount of work done in each country.

My question is am I personally liable for any unpaid USA taxes?

Do I have to file a Tax Return in the US if I wasnâ€™t issued a W4 from my company?

My company is no longer allowed to send me to the US as an employee, or anyone else for that matter.
If I create my own company would I then be able to work in the US (if I am personally liable I would assume no).

Cheers,

JGCA · Post by **JGCA** » Wed Jan 18, 2012 9:04 pm

As an employee you worked in US for 2010 and 2011 you could claim under treaty that you are closer connected to Canada and not file a US return just the treaty disclosure. You are not liable for US tax as long as you file in Canada.

You could form your own company in Canada to work in the US but then you have to see how many days you will spend in the US by then you will probably have to file US tax returns, also what visa you need to apply for to go to US the simplest is a TN if you qualify.

nelsona · Post by **nelsona** » Sun Jan 22, 2012 1:45 am

JC, this is not correct, as of the new treaty.

By spending more than 183 days in ANY 365 day period, the employee becomes taxable in US.

The company needs to sort this out for you.

JGCA · Post by **JGCA** » Sun Jan 22, 2012 4:55 pm

Yes you would be taxable in the US if in ANY 12 month period you are over 183 days, so check the dates since you indicate less days in 2011 than 183 it may be you are exempt but you need to check the dates. As far as being taxable by your employment proportional to the contracting state this applies if you were also over 183 days in the year and you earned more than 50% of your total income in the US by virtue of teh new treaty.