Case study 1
Staff rotating into a Canadian project site for a foreign employer
A foreign employer with no Canadian entity was rotating technicians through a Canadian site on short assignments, each paid through the home payroll. The obligation to deduct on the income attributable to the Canadian duties sat with the employer regardless of where that payroll ran. The work was to register for what was needed, decide for each person whether the treaty exempted the income, apply for the relief that fitted, and set up a way of recording days worked in Canada. It produced a payroll that deducted correctly, authorised relief where it applied, and a defensible day record.
Case study 2
Years of unrecorded Canadian work days found during a sale
A buyer's due diligence asked a company how many days its foreign employees had worked in Canada, and nobody could answer. Travel bookings and expense claims showed considerably more Canadian time than the payroll had ever reflected. The work was to reconstruct the days from the records that did exist, identify the employees and years in which a deduction obligation had arisen, test each against the treaty, and quantify what remained. It produced a documented exposure the parties could deal with in the transaction, corrected filings for the years still open, and a tracking process going forward.
Case study 3
An employee recovering payroll deductions the treaty had exempted
An employee seconded into Canada for part of a year had Canadian tax deducted from every payslip for the period, although the treaty exempted the employment income on the facts. No relief had been applied for before the payroll ran, so the deduction was correct as made and the money had to be recovered by filing. The work was to establish the residence position, apportion the salary to the Canadian duties, gather the employer's year-end reporting in a usable form, and file. It produced a filed Canadian return and the deducted amount claimed back for the year.
Case study 4
Putting an employer certification in place before the next assignment
An employer that regularly sent treaty-exempt staff to Canada was tired of applying for relief person by person, and of the deductions that ran whenever an application was late. The work was to test whether the certification route open to non-resident employers fitted the business, assemble the application, and build the tracking and reporting that such a certification requires the employer to maintain. It produced a certification the employer could rely on for qualifying employees, a record-keeping routine attached to it, and a shorter path from a confirmed assignment to a payroll that handles it correctly.
Case study 5
Apportioning a salary between Canadian and foreign duties
A cross-border commuter worked partly at an office in Canada and partly at home abroad, on one salary from one employer. The amount on which the Canadian deduction should run was the part attributable to duties performed in Canada, and nobody had measured it. The work was to define what counted, build the day record from calendars, border crossings and the employer's own attendance data, and set the apportionment the payroll would use. It produced a written basis for the split, a payroll deducting on that basis, and a record that supports the employee's return in both countries.
Case study 6
Board meeting travel and whether the payments were employment income
A non-resident who sat on a Canadian board was paid for attending meetings held in Canada, and the company had treated those payments inconsistently from one year to the next. The first question was what the payments were, employment income from duties performed in Canada or a fee for services, because the deduction regime and the relief route differ. The work was to settle the characterisation from the appointment terms and the way the role was actually performed, then apply the corresponding treatment. It produced one consistent treatment and the relief application that went with it.
Case study 7
One Salary, Two Countries Claiming It
A US citizen resident in Canada, taxed in full on both sides because each return was prepared without the other in view. Deciding which country has the first right to the income, then claiming relief on the second return in the right order, is what stops the same dollar being taxed twice.
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Case study 8
One Salesperson Abroad, and a Corporate Filing Obligation
A single employee with authority to conclude contracts can create a taxable presence for the whole company. The review tests what the person actually does against the treaty article, and where a presence exists, works out what profit is attributable to it.
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