Do I file Regulation 102 or does my foreign employer?
Both have something to do, and it is not the same thing. The waiver of payroll withholding is sought in respect of the employee's income, so the employee's facts drive it: days in Canada, duties performed here, and who bears the cost of the employment. The employer is the party that would otherwise withhold and remit on the Canadian payroll, so it is the employer's obligation the waiver relieves. In practice the application is prepared with both sides' information on the table, meaning the employment contract, the assignment letter and the travel record. Deciding who signs what is the last step rather than the first.
My employee is only in Canada for a short project, does this apply?
Short does not mean exempt. Withholding on employment income earned in Canada is the default whoever the employer is and however brief the assignment, and it is relieved by a waiver or by a certification route rather than by the length of the trip. Two questions decide the position: whether the treaty exempts the employment income at all, and whether the employer qualifies for the streamlined certification route. Neither is answered by how many weeks the assignment runs. Work the answer out before the first Canadian payroll date, because the alternative is withholding on income that may not be taxable here.
Does my work permit mean I do not need a Regulation 102 waiver?
No. Immigration status and tax withholding are decided by different rules and different authorities. A permit says you may work in Canada. It says nothing about whether the income you earn here is taxable in Canada, or whether your employer must withhold from it. The tax question turns on the treaty position for your employment income and on your employer's own standing with the CRA. People are caught by this regularly, having assumed the permit settled everything. Treat them as two separate matters with separate evidence, and do not let the timing of one drive the assumptions of the other.
Who is responsible if withholding was never taken from a Canadian assignment?
The withholding obligation sits with the employer, so that is where the CRA looks first, and it looks for the amount that should have been withheld rather than for the employee's own tax. The employee is not out of it, because the income still has to be reported where it is taxable, but the two exposures are separate and they are resolved separately. Where an assignment has run without withholding, handle the employer's position and the employee's position as two pieces of work. Establishing whether the treaty exempted the income at all usually decides how large a problem either one is.
Can one waiver cover several employees on the same Canadian project?
The analysis is per employee, because the facts that matter are individual: the duties performed in Canada, the days spent here, and the treaty that applies to that person. A project staffed from two countries has at least two positions to establish, even where the assignment letters look identical. What can be shared is the groundwork, meaning the contract with the Canadian client, the project calendar and the description of what the team is actually doing here. Build that once, then apply it person by person. Expect the answers to differ, particularly where someone's home country has a different treaty with Canada.
What does my employer need to give me to support the application?
Start with the documents that describe the employment rather than the trip: the contract of employment, the assignment or secondment letter, the payroll record showing where the salary is actually paid from and borne, and the agreement with the Canadian client. Then the calendar, meaning the dates in and out of Canada and what was done on each. Where the employer is relying on the streamlined certification route, its own standing with the CRA needs evidencing too, and that sits in the employer's file rather than yours. Gather it before the first Canadian pay date. Assembling it afterwards is the same work under pressure.
Is my foreign pension taxable?
Usually in at least one country, and which one depends on the treaty article covering pensions — some give the taxing right to the country paying it, others to where you live, and several treat government service pensions differently again. Withholding at source is common and often reducible by treaty, with an elective return recovering an over-deduction. See the pensions article.
What is TCS on foreign remittance?
Tax collected at source. When a resident individual remits money abroad under the Liberalised Remittance Scheme — or buys an overseas tour package — the bank or seller collects an amount of tax on top and deposits it against your PAN. It is not a cost and it is not a final tax: it appears in your annual tax statement and is set off against the tax on your return, with the excess refunded. The rates and the purposes they attach to have been amended repeatedly, so we confirm them for the remittance year. See LRS limits and TCS.
