Taxes - Work for Canadian employer after moving

[Rose__ 303]

Bonjour hi!

 

I'm currently waiting for my IR1 interview in a couple of weeks. My Canadian employer is aware of my situation and wants to keep me after I move.

I now need to figure out how to set up the proper status for myself, taxes, etc. My accountant here told me that, should I work for my employer as a non-resident, I'd be taxed a lot up here in Canada. He recommended working as a US independent worker ("travailleuse autonome") instead. My employer is opened to this too.

 

Has anyone had any experience with that? Is there anything in particular that I should consider?

How long does it take to set it up?

 

Needless to say I'm also doing research online and my employer will work on it too. However I'd love to get some feedback from fellow VJ members Thank you.

[Ptitchou 117]

I'm also looking into this route. When one of my co-workers relocated back to Thailand, he ended up having his "official" employment terminated so that they could re-sign him as a contract worker. No benefits or taxes taken off and still paid in CAD, but he'd have to pay his own taxes on income in his country of residence. If I decide to stay with my company, this is also the route I would be taking. On the bright side, it might be a good opportunity to renegotiate for compensation, especially since they won't need to pay benefits for you anymore if you had them. (You'll have to get American insurance.)

[Boiler 45,580]

US taxes you on your worldwide income so that bit is simple.

 

I would imagine it would be best for you to be treated as a foreign contractor, would be if you were from the UK.

[JlovesA 109]

I still work for my Canadian employer. I do have to pay federal and provincial taxes which sucks, but it's still a better job than if I quit and tried to find something local. I get a decent return back from the Canadian government every year. I haven't had to pay any taxes to the IRS. I've had my taxes professionally done in both countries since I moved and have had no issues. 

[Ptitchou 117]

On 9/17/2020 at 9:23 AM, JlovesA said:

I still work for my Canadian employer. I do have to pay federal and provincial taxes which sucks, but it's still a better job than if I quit and tried to find something local. I get a decent return back from the Canadian government every year. I haven't had to pay any taxes to the IRS. I've had my taxes professionally done in both countries since I moved and have had no issues. 

Interesting. I didn't know you could do this legally. Are you still on a regular payroll and have the Canadian taxes deducted from your salary? I'm also very surprised that the IRS wouldn't be claiming their share. 

 

[JlovesA 109]

3 hours ago, Ptitchou said:

Interesting. I didn't know you could do this legally. Are you still on a regular payroll and have the Canadian taxes deducted from your salary? I'm also very surprised that the IRS wouldn't be claiming their share. 

 

There are tax treaties in place between Canada and the USA to avoid cross-border workers being taxed to death. My situation is completely legal, no loopholes or anything like that. I have a top secret security clearance at work and am seeking US citizenship right now, so I’m not in a position to scam any governments. I work for the Canadian federal government.

Edited September 18, 2020 by JlovesA

[Ptitchou 117]

6 hours ago, JlovesA said:

There are tax treaties in place between Canada and the USA to avoid cross-border workers being taxed to death. My situation is completely legal, no loopholes or anything like that. I have a top secret security clearance at work and am seeking US citizenship right now, so I’m not in a position to scam any governments. I work for the Canadian federal government.

That's great! I wasn't thinking there was any scam, just didn't know about this. I'll need to consult a lawyer when it comes time to move and see what they recommend. Thanks for the info. 

[Lemonslice 4,860]

On 9/14/2020 at 12:09 PM, Rose__ said:

Bonjour hi!

 

I'm currently waiting for my IR1 interview in a couple of weeks. My Canadian employer is aware of my situation and wants to keep me after I move.

I now need to figure out how to set up the proper status for myself, taxes, etc. My accountant here told me that, should I work for my employer as a non-resident, I'd be taxed a lot up here in Canada. He recommended working as a US independent worker ("travailleuse autonome") instead. My employer is opened to this too.

 

Has anyone had any experience with that? Is there anything in particular that I should consider?

How long does it take to set it up?

 

Needless to say I'm also doing research online and my employer will work on it too. However I'd love to get some feedback from fellow VJ members Thank

Usually, contractors hourly rates are different than employees' salary. Don't forget to take that into account, since you might lose contributions to CPP (RPQ), and other benefits.

Here's an example, you'll have to adjust to your situation:

 

http://crossfireconsulting.com/blog/2018/07/so-you-want-to-be-a-contractor-use-our-calculator-to-determine-your-rate/

 

Bonne chance Rose!