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| Subject: Tax issues working for a US corporation in Canada |
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Hi everyone,
I am new to this site, but have been reading many of the postings with interest. I received my PR status as a skilled worker in June 2006 after about a 1.5 year process. Here is my timeline:
November 2004 Submitted skilled worker application
March 2005 Received notification that my application was received
December 2005 Request for medical exam
May 2006 Request for passport
June 2006 Passport received with visa
I am a US citizen and currently live in the US and work for a non-profit organization which has recently registered itself in Canada. I will continue to work for this organization and will be the first and only employee in the newly-created Canadian branch of my organization. My questions are the following:
1. I know there is a tax treaty between the US and Canada which means I do not have to pay income tax in both countries. I am assuming I will pay income tax in Canada since I will be residing there. How do I deal with income taxes in the U.S.?
2. If my organization continues to pay me in US dollars and deposits my income into a US bank account, will that cause problems for me if I want to access the money in Canada (will I have to pay extra tax on it every time I access the money)? Would I be better off having them direct deposit my income to a Canadian bank?
Thanks in advance for your assistance.
Christina
[11-09-2006,19:29]
[***.87.18.25]
Christina |
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(in reply to: Tax issues working for a US corporation in Canada)
If they are paying you to a US account, then you are earning the money in the US. This will definately be true if they are declaring your pay to the US government - W2 forms and so on. You need to contact an accountant that can cover this issue. You need to see how the Canadian government will handle this US income as well.
Note: you will probably still have to file income tax with the US government if your pay is transfered to Canada as you are a US citizen. If your income is over a certain level, you may be liable for US taxes (the level is $75,000 in Japan). Only when you become a Canadian citizen will you no longer be required to file income in the US.
[12-09-2006,07:56]
[***.3.76.24]
Anonymous |
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