Working remotely for us company tax issues

canadian81 · Post by **canadian81** » Tue Jul 04, 2017 10:28 am

I am a Canadian Resident working remotely for USA company (permanent) on W-2 in TN status. My payroll is run in the USA. My actual work location is in USA. I initially worked 70% of time from USA but last year I worked 90% from Canada (as I gained confidence of my manager). As I am more than 183 days out of USA and my employment income comes from a USA based company, my employment income will be taxable in USA (based on Canada-USA tax treaty, my employment incomes comes from a permanent establishment of a company in USA , I would be taxable in USA only and claim my us taxes as Foreign credit on my Canadian returns). Am I correct?

Update: I spoke with a CRA agent who is expert on Foreign income for Canadian residents. She agrees with what I said above. It does not matter how long I am present in Canada if I am working for a US employer

canadian81 · Post by **canadian81** » Tue Jul 04, 2017 1:06 pm

Update 2: I spoke with one more CRA agent who specifically deals with Foreign income for Canadian residents. He also agreed with what I mentioned. Since my contract of employment is for USA, I am first taxed in USA and it does not matter if I worked all 365 days from Canada

nelsona · Post by **nelsona** » Wed Jul 05, 2017 9:15 am

Pran,
Why are you asking here? You have your answer from a CRA telephlunkie. That is all you need.

nelsona · Post by **nelsona** » Wed Jul 05, 2017 10:17 am

https://home.kpmg.com/content/dam/kpmg/ ... fc1602.pdf

Clearly states that foreign employers of employees working in Canada must provide a T4 covering the work performed in Canada.

https://www.ctf.ca/ctfweb/EN/Newsletter ... 50402.aspx

Currently, non-resident employers are required to withhold Canadian payroll remittances (regulation 102 withholdings) for any employees physically working in Canada, regardless of whether the employee is resident in Canada and is ultimately exempt from Canadian income tax on his or her employment income under a tax treaty. If the employer is already deducting payroll withholdings for its employees in their home country, the Canadian payroll withholdings will be an additional burden.

nelsona · Post by **nelsona** » Wed Jul 05, 2017 10:18 am

CRA telephlunkies are notoriously incorrect, as in this case.

nelsona · Post by **nelsona** » Wed Jul 05, 2017 10:22 am

https://www.bnncpa.com/resources/librar ... dian_taxes

Non-resident employers are required to withhold and remit income taxes, Canadian Pension Plan Contributions, and Employment Insurance premiums for each of their employees working in Canada, unless a waiver has been issued by the Canadian Revenue Agency (CRA). The withholding requirements under Regulation 102 apply even to employees who reside in a country with Canadian Treaty benefits that exempt his or her income from tax in Canada (i.e., U.S. resident employees). To avoid the mandatory withholding, the employee must apply for a Regulation 102 waiver or, alternatively, the employer and employee may be able to file a joint waiver application.

canadian81 · Post by **canadian81** » Wed Jul 05, 2017 11:57 am

Nelsona,

Dude, I already quoted from tax treaty. Please stop spreading false information. I did not ask for your opinion. I already posted in Canadianmoneyforum and everyone agreed with my opinion. your explanation might apply for any other country but usa and canada have a specific tax treaty. Can you point anyone on this forum who had faced this issue? I posted here so that everyone knows the correct information.

canadian81 · Post by **canadian81** » Wed Jul 05, 2017 12:11 pm

Nelsona,

Are you a tax accountant? Do you even read what you posted?

canadian81 · Post by **canadian81** » Wed Jul 05, 2017 12:27 pm

It's simple. My US employer will claim my employment as business expense in their company tax returns in usa. So US has the first right over my employment taxes

nelsona · Post by **nelsona** » Wed Jul 05, 2017 12:40 pm

Pran, I will have you removed again.

nelsona · Post by **nelsona** » Wed Jul 05, 2017 12:55 pm

And I carefully did not give you my opinion. I gave you the opinion of well-respected professionals.

canadian81 · Post by **canadian81** » Wed Jul 05, 2017 1:17 pm

Please read the US-Canada treaty. I quoted from both Canadian and US government websites. I got opinion from multiple tax accountants. I got feedback from multiple CRA agents. The below is from one of your reference

https://home.kpmg.com/content/dam/kpmg/ ... fc1602.pdf

"For example, a U.S. resident employee will generally be exempt from Canadian tax if the remuneration does not exceed CDN $10,000 or if the employee is present in Canada for no more than 183 days in any 12-month period commencing or ending in the relevant calendar year and if the remuneration is not borne (i.e., not deductible as an expense) by a permanent establishment in Canada."

nelsona · Post by **nelsona** » Wed Jul 05, 2017 1:48 pm

You are NOT a US resident employee, as we established last week. You are a Cdn resident. Move to US and all you say will be true. But you are a Cdn resident WORKING in Canada.

Next.

canadian81 · Post by **canadian81** » Wed Jul 05, 2017 1:51 pm

I am an employee of a US Resident.

canadian81 · Post by **canadian81** » Wed Jul 05, 2017 1:54 pm

Can you tell me what is your qualification?