Personal Tax
Business -> Foreign
employers in Canada
Tax Deductions - Foreign Employers in Canada
Income Tax Act s. 153, Regulations s. 100 to 105
Canada Pension Plan Regulations s. 22
Employment Insurance Act s. 5
Employers resident in another country and without an establishment in Canada who have employees in Canada (either resident or non-resident in Canada) are responsible for collecting
 | income taxes, except for certified non-resident employers when they pay amounts to non-resident employees working for them in Canada. | ||||
|
Employment Insurance (EI) premiums, except when
| ||||
| Canada Pension Plan (CPP) contributions, at the option of the employer. If the employer chooses to contribute for their employees, they can apply by completing Form CPT13 from the Canada Revenue Agency (CRA) website, except for employees employed in the Province of Quebec. See the form for more information. If the employer does not choose to contribute for their employees, the employment is excepted from pensionable employment. |
However, a tax treaty between Canada and the country of residence of a non-resident employee may provide for relief from Canadian tax deductions.
If the foreign firm is paying for services rendered in Canada by a self-employed contractor
| who is a resident of Canada, no withholding taxes are required |
| who is a non-resident of Canada, a withholding tax of 15% is required |
TaxTips.ca Resources
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Canada Revenue Agency (CRA) Resources
Residency of a corporationForeign employees and employers
T4001 Employers' Guide - Payroll Deductions and Remittances
From T4001: Employment in Canada by certified non-resident employers
Revised: October 26, 2023