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Can I work remotely for a company anywhere in or outside of Canada?
Yes, you can work remotely anywhere but there are some things you should consider first.
As a result of the pandemic and technology making it easier to work from home, we have seen a rise in remote work opportunities. There are also more grey areas on the legalities of working from home. These are some things to think about if you're considering doing remote work outside of Ontario.
Working remotely for a company in another province or country can get complicated at tax time. If you earn income in Canada, you must pay taxes on it. Your income taxes are calculated based on where your primary residence is, not your residency status, citizenship or immigration status. How you pay your taxes depends on whether you’re hired as an employee or a self-employed contractor (work independently).
If you’re self-employed, your employer might already work with a professional employer organization (PEO). PEOs are external companies that provide human resources services to manage complex administrative tasks for the client. You would work directly through the PEO for all HR-related matters like:
- payroll and deducting income taxes
- health and safety work issues
- advocating for your labour/employee rights (different countries have different employment standards)
As an employee working for a Canadian company, you will be taxed based on the rules of the employer’s home province. For example, you’re working in Ontario for a company located in British Columbia (BC). The employer will deduct Canada Pension Plan (CPP) contributions, Employment Insurance (EI) premiums and income taxes based on BC rates. But you’re still responsible for meeting the tax requirements of Ontario. If there is a discrepancy between the BC tax requirements and the Ontario ones, the Canada Revenue Agency (CRA) will adjust the difference. You may owe the difference to the CRA for underpayment or get a refund.
If you’re self-employed or a contractor, you will get direct pay with no tax deductions from the employer. You are responsible for obtaining and filling out a General T1 Form to file your taxes with the requirements of the location of your primary residence.
Worldwide income is any income that is earned outside of Canada while living in Canada. You must report your income in Canadian dollars if you are working for a company outside of Canada. It can be more complex to file these taxes so you might consider working with an accountant to help you file correctly or visit a free tax clinic through the CRA.
Let’s say you are working for a company in the United States (US), Canada has a special tax treaty agreement with the US so you only pay taxes in Canada. Check the tax treaty of the country you are working for to avoid double taxation requirements.
Remember that as a self-employed remote worker, you might be eligible to write off some of your home-office expenses to offset what you pay in taxes.
Calculating Canadian Work Hours for Permanent Residence (PR) Requirements
If you work for a Canadian company that offers services within Canada, that counts towards your PR requirements. Remote work for a company outside Canada is considered foreign work and wouldn't count toward the Express Entry application. Also, if you applied for a Provincial Nominee Program (PNP), you must work in the same province as the PNP application. Keep this in mind when considering remote employment opportunities.
Visitors, Work Permits and Remote Work
Working remotely as a visitor is a great way to enjoy Canada's culture and experience life here. Not all foreign workers need a work visa or authorization from IRCC to work remotely in Canada. According to the Immigration and Refugee Protection Regulations (IRPR), you can work here remotely as a visitor without a work permit for extended periods provided that:
- You work for a non-Canadian company that offers business services outside of Canada.
- The employer pays you outside of Canada.
- The non-Canadian company has no Canadian operations, branches, or services offered here.
If the work meets all those requirements, you're not expected to get a work visa because you're not entering the Canadian labour market. You would still need proper authorization to enter and travel to Canada. For further reading, check the Come to Canada eligibility tool to see if you qualify for remote work here without a permit.
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May 26, 2023