3 ms·

As a foreign resident, don't pay US taxes unless you're a US citizen. If you don't use a PEO for some absurd reason, you may need to file a 1120F if you're expo

by sunir 6y ago

As a foreign resident, don't pay US taxes unless you're a US citizen. If you don't use a PEO for some absurd reason, you may need to file a 1120F if you're exporting > $100k USD directly and you will have to issue a W8BEN or else your income is subject to a 30% withholding tax at the source.

nrmitchi 6y ago
Pardon? If you are a resident in the US, you pay taxes (whether you are a citizen or not).
- sunir 6y ago
  This person wants to live and work from within Canada. Hence they are outside the US and do not owe US taxes.
  - nrmitchi 6y ago
    Okay, yes, we're on the same page. If they're not in the US though (as a Canadian), they're not a resident, and therefore not a "foreign resident". The entire situation is weird because as we both mentioned elsewhere, the correct approach here is a PEO (or setting up the appropriate hiring organization in Canada), rather than claiming to live (or work) in the US in order to get a TN (either or which would subject them to US taxation), and then claim to not when it comes to taxes.
  - phonebanshee 6y ago
    They want to be an employee of a company in California, while living and working in Canada. This sounds like it's going to be complicated, and a blanket answer of "you don't pay US taxes" seems unlikely to be correct. They're also going to face issues like on day 1 when they walk into the office and they're going to have to go through the whole I-9 thing (https://www.uscis.gov/i-9-central https://www.uscis.gov/i-9-central) - waving hands and saying I'm going to live in Canada seems like it's not a solution.
    - dboreham 6y ago
      They can't be an employee of a US corporation (as in, a person who gets a W-2, etc). What they can do is either a) have the US employer set up a Canadian subsidiary that handles their payroll or b) set up their own Canadian legal entity (corporation, sole trader??) and execute a services contract between the two companies. Then they can pay themselves under Canadian rules out of that company, or do whatever plumbers do in Canada -- sole trader or whatnot. ianal, nor Canadian.

by sunir 6y ago

nrmitchi 6y ago

Pardon? If you are a resident in the US, you pay taxes (whether you are a citizen or not).

sunir 6y ago
This person wants to live and work from within Canada. Hence they are outside the US and do not owe US taxes.
- nrmitchi 6y ago
  Okay, yes, we're on the same page. If they're not in the US though (as a Canadian), they're not a resident, and therefore not a "foreign resident". The entire situation is weird because as we both mentioned elsewhere, the correct approach here is a PEO (or setting up the appropriate hiring organization in Canada), rather than claiming to live (or work) in the US in order to get a TN (either or which would subject them to US taxation), and then claim to not when it comes to taxes.
- phonebanshee 6y ago
  They want to be an employee of a company in California, while living and working in Canada. This sounds like it's going to be complicated, and a blanket answer of "you don't pay US taxes" seems unlikely to be correct. They're also going to face issues like on day 1 when they walk into the office and they're going to have to go through the whole I-9 thing (https://www.uscis.gov/i-9-central https://www.uscis.gov/i-9-central) - waving hands and saying I'm going to live in Canada seems like it's not a solution.
  - dboreham 6y ago
    They can't be an employee of a US corporation (as in, a person who gets a W-2, etc). What they can do is either a) have the US employer set up a Canadian subsidiary that handles their payroll or b) set up their own Canadian legal entity (corporation, sole trader??) and execute a services contract between the two companies. Then they can pay themselves under Canadian rules out of that company, or do whatever plumbers do in Canada -- sole trader or whatnot. ianal, nor Canadian.