What is a T1134 Information Return Relating to Foreign Affiliates?
What is a T1134 Information Return Relating to Foreign Affiliates? March 24, 2022 Tax Question: What is a T1134 information return relating to controlled and
Home » News » International Tax FAQs » What is a Qualifying Non-Resident Employee
Tax Question:
If I am a qualifying non-resident employer, how do I know if an employee is a qualifying non-resident employee?
Facts:
If you are a certified qualifying non-resident employer, then you do not have to withhold taxes from the salary or other compensation paid to employees that are qualifying non-resident employees in Canada.
In order to be a qualifying non-resident employee, the employee must meet the following criteria:
Working days are counted based on days in Canada in which the employee is paid for work. This would exclude weekends, days off and holidays. Conversely, days of presence is counted based on the days the employee is in Canada whether working or not. In addition, even though income tax would not be withheld, Canada Pension Plan (CPP) contributions and Employment Insurance (EI) premiums may still have to be deducted. If the employer does not have an establishment in Canada or the employee has coverage in their country of residence (must produce a certificate of the coverage), then CPP contributions are not required. Similarly, if an employee has comparable coverage in their country of residence, then EI premiums are not required.
If you would like more information on this topic, please contact a member of the Empire CPA team by filling out the contact form below.
Canadian and foreign tax laws are complex and have a tendency to change on a frequent basis. As such, the content published above is believed to be accurate as of the date of this post. Before implementing any tax planning, please seek professional advice from a qualified tax professional. Empire, Chartered Professional Accountants will not accept any liability for any tax ramifications that may result from acting based on the information contained above.
What is a T1134 Information Return Relating to Foreign Affiliates? March 24, 2022 Tax Question: What is a T1134 information return relating to controlled and
What is Part XIII Income Tax and how does it affect non-resident corporations? August 26, 2020 Tax Question: What is Part XIII income tax and
What is a T106? Non-Arm’s Length Transactions with Non-Residents August 14, 2020 Tax Question: What is a T106 information return of non-arm’s length transactions with
What is an Input Tax Credit for GST? February 28, 2020 Tax Question: What is an input tax credit (ITC) for GST? Facts: ITCs refer