Canada PR Holder on H1B Visa working remote in Canada

[srinikrish]

Hello,

I'm a Canada PR holder and having US H1B Visa. Working for a US company on H1b visa remotely from Canada since February 2020.. Does it impact my Tax filing/H1B Extension & Green Card processing.? Anyone in the same boat, please reply.

Thanks,
Krish

 

[harirajmohan]

Hello,

I'm a Canada PR holder and having US H1B Visa. Working for a US company on H1b visa remotely from Canada since February 2020..
1. Does it impact my Tax filing/H1B Extension & Green Card processing.?
2. Anyone in the same boat, please reply.

Thanks,
Krish

2. Is 485 filed?

1. The below threads talk about these.
Tax: https://www.canadavisa.com/canada-immigration-discussion-board/threads/tax-challenges.715793/
https://www.canadavisa.com/canada-immigration-discussion-board/threads/taxes-payroll-working-in-us-living-in-windsor.551077/

PR and GC: https://www.canadavisa.com/canada-immigration-discussion-board/threads/maintaining-residency-on-both-us-and-canadian-side-contact.715219/

H1: https://www.canadavisa.com/canada-immigration-discussion-board/threads/us-gc-i-140-petition-after-getting-canadian-citizenship.715759/
https://www.canadavisa.com/canada-immigration-discussion-board/threads/working-remotely-from-canada-while-on-h1b.616600/page-4

 

[ca_hopeful]

Hello,

I'm a Canada PR holder and having US H1B Visa. Working for a US company on H1b visa remotely from Canada since February 2020.. Does it impact my Tax filing/H1B Extension & Green Card processing.? Anyone in the same boat, please reply.

Thanks,
Krish

Hey Krish,
I'm in a similar situation. I consulted an accountant and got some advice on this. So the advice I got is specific to my situation but can share it here as it might be helpful.

1. Taxation in Canada - Whether or not I will be taxed in Canada will depend on my residency status as defined by cra(this is different from immigration status). For my situation since the day I moved to Canada on PR I am considered a Canadian tax resident. So even if I am getting my salary in US dollar in a US bank I have tax liability here in Canada for my global income (salary, dividends, stock gains, interest income etc.). Keep in mind that tax brackets in Canada are higher so you would be owing more taxes in Canada. I will be filing my taxes in 2021 and will pay whatever tax I owe since the time I moved to Canada.

2. Taxes in US - Taxes will continue to be taken from my payroll as usual but as I will be filing as a resident in Canada I will not be considered as a tax resident in US from the time I moved to Canada. Example: Say I moved to Canada on Nov 1 - Then Nov 1 to Dec 31 I am a Canadian tax resident but Jan 1 to Oct 31 I was a US tax resident. Due to tax treaty I will get refund for the taxes I already paid in US while I was a resident of Canada as I will be paying taxes in Canada.

3. Tax Payment Timeline - I'm not very clear on this part but ideally your taxes should go to CRA during every pay period or every quarter. Since you have been working from Feb you might be owing taxes since Feb which might be a significant amount.

Difficult part for me is I will need to pay Canada taxes out of pocket and then wait to get US tax refund which might create a cash flow issue.

I'd recommend connecting with a cross border tax specialist to get answers to your specific situation and be compliant. Keep in mind that the points are just for my specific situation and might not be applicable to you. Best to consult an accountant to get the right advice.

Thanks!

 

[harirajmohan]

3. Tax Payment Timeline - I'm not very clear on this part but ideally your taxes should go to CRA during every pay period or every quarter. Since you have been working from Feb you might be owing taxes since Feb which might be a significant amount.

Difficult part for me is I will need to pay Canada taxes out of pocket and then wait to get US tax refund which might create a cash flow issue.

Timeline should not be a problem.
File tax in US between Feb first week and Apr15th. You can very well get the refund from IRS long before you can file at CRA.
File tax in Canada as the deadline is Apr30.

So you dont need to pay out of pocket on the amount equivalent to US taxes upfront in Canada as you will be deducting the USD tax amount in CRA tax return saying you already paid in US. And you would pay the rest of the tax to CRA.

If you want to avoid double tax then you are supposed to be mentioning the tax paid in US.
Also you will be deducting the net tax paid (which means that the refund is not part of the tax).

 

[srinikrish]

Thanks Everyone

 

[srinikrish]

Hey Krish,
I'm in a similar situation. I consulted an accountant and got some advice on this. So the advice I got is specific to my situation but can share it here as it might be helpful.

1. Taxation in Canada - Whether or not I will be taxed in Canada will depend on my residency status as defined by cra(this is different from immigration status). For my situation since the day I moved to Canada on PR I am considered a Canadian tax resident. So even if I am getting my salary in US dollar in a US bank I have tax liability here in Canada for my global income (salary, dividends, stock gains, interest income etc.). Keep in mind that tax brackets in Canada are higher so you would be owing more taxes in Canada. I will be filing my taxes in 2021 and will pay whatever tax I owe since the time I moved to Canada.

2. Taxes in US - Taxes will continue to be taken from my payroll as usual but as I will be filing as a resident in Canada I will not be considered as a tax resident in US from the time I moved to Canada. Example: Say I moved to Canada on Nov 1 - Then Nov 1 to Dec 31 I am a Canadian tax resident but Jan 1 to Oct 31 I was a US tax resident. Due to tax treaty I will get refund for the taxes I already paid in US while I was a resident of Canada as I will be paying taxes in Canada.

3. Tax Payment Timeline - I'm not very clear on this part but ideally your taxes should go to CRA during every pay period or every quarter. Since you have been working from Feb you might be owing taxes since Feb which might be a significant amount.

Difficult part for me is I will need to pay Canada taxes out of pocket and then wait to get US tax refund which might create a cash flow issue.

I'd recommend connecting with a cross border tax specialist to get answers to your specific situation and be compliant. Keep in mind that the points are just for my specific situation and might not be applicable to you. Best to consult an accountant to get the right advice.

Thanks!

Thanks Very much

 

[srinikrish]

Hey Krish,
I'm in a similar situation. I consulted an accountant and got some advice on this. So the advice I got is specific to my situation but can share it here as it might be helpful.

1. Taxation in Canada - Whether or not I will be taxed in Canada will depend on my residency status as defined by cra(this is different from immigration status). For my situation since the day I moved to Canada on PR I am considered a Canadian tax resident. So even if I am getting my salary in US dollar in a US bank I have tax liability here in Canada for my global income (salary, dividends, stock gains, interest income etc.). Keep in mind that tax brackets in Canada are higher so you would be owing more taxes in Canada. I will be filing my taxes in 2021 and will pay whatever tax I owe since the time I moved to Canada.

2. Taxes in US - Taxes will continue to be taken from my payroll as usual but as I will be filing as a resident in Canada I will not be considered as a tax resident in US from the time I moved to Canada. Example: Say I moved to Canada on Nov 1 - Then Nov 1 to Dec 31 I am a Canadian tax resident but Jan 1 to Oct 31 I was a US tax resident. Due to tax treaty I will get refund for the taxes I already paid in US while I was a resident of Canada as I will be paying taxes in Canada.

3. Tax Payment Timeline - I'm not very clear on this part but ideally your taxes should go to CRA during every pay period or every quarter. Since you have been working from Feb you might be owing taxes since Feb which might be a significant amount.

Difficult part for me is I will need to pay Canada taxes out of pocket and then wait to get US tax refund which might create a cash flow issue.

I'd recommend connecting with a cross border tax specialist to get answers to your specific situation and be compliant. Keep in mind that the points are just for my specific situation and might not be applicable to you. Best to consult an accountant to get the right advice.

Thanks!

Really well explained. It clarified all my doubts. Thanks very much for the information. Please suggest if you know any Cross border Tax Consultant. I live in Oakville, Ontario.

Thanks,
Krish

 

[justinline]

Hey Krish,
I'm in a similar situation. I consulted an accountant and got some advice on this. So the advice I got is specific to my situation but can share it here as it might be helpful.

1. Taxation in Canada - Whether or not I will be taxed in Canada will depend on my residency status as defined by cra(this is different from immigration status). For my situation since the day I moved to Canada on PR I am considered a Canadian tax resident. So even if I am getting my salary in US dollar in a US bank I have tax liability here in Canada for my global income (salary, dividends, stock gains, interest income etc.). Keep in mind that tax brackets in Canada are higher so you would be owing more taxes in Canada. I will be filing my taxes in 2021 and will pay whatever tax I owe since the time I moved to Canada.

2. Taxes in US - Taxes will continue to be taken from my payroll as usual but as I will be filing as a resident in Canada I will not be considered as a tax resident in US from the time I moved to Canada. Example: Say I moved to Canada on Nov 1 - Then Nov 1 to Dec 31 I am a Canadian tax resident but Jan 1 to Oct 31 I was a US tax resident. Due to tax treaty I will get refund for the taxes I already paid in US while I was a resident of Canada as I will be paying taxes in Canada.

3. Tax Payment Timeline - I'm not very clear on this part but ideally your taxes should go to CRA during every pay period or every quarter. Since you have been working from Feb you might be owing taxes since Feb which might be a significant amount.

Difficult part for me is I will need to pay Canada taxes out of pocket and then wait to get US tax refund which might create a cash flow issue.

I'd recommend connecting with a cross border tax specialist to get answers to your specific situation and be compliant. Keep in mind that the points are just for my specific situation and might not be applicable to you. Best to consult an accountant to get the right advice.

Thanks!

Did you look into W8 and 8233 to eliminate or reduce withholding on the US side?

 

[srinikrish]

Did you look into W8 and 8233 to eliminate or reduce withholding on the US side?

What is W8 and 8233 Forms. Please provide some detailed information.

Also, Any Cross border Tax consultants who can help me on this..

 

[ca_hopeful]

Did you look into W8 and 8233 to eliminate or reduce withholding on the US side?

Hey,
I haven't yet, but will bring this up with my accountant to learn more. Thanks for the info!

 

[ca_hopeful]

Really well explained. It clarified all my doubts. Thanks very much for the information. Please suggest if you know any Cross border Tax Consultant. I live in Oakville, Ontario.

Thanks,
Krish

There are a lot of cross border tax consultants if you Google them. I spoke to someone from S+C Partners.

 

[justinline]

Hey,
I haven't yet, but will bring this up with my accountant to learn more. Thanks for the info!

What is W8 and 8233 Forms. Please provide some detailed information.

Also, Any Cross border Tax consultants who can help me on this..

Check this link out.....there is Employees section
https://www.irs.gov/individuals/international-taxpayers/claiming-tax-treaty-benefits

 

[dry.00]

2. Is 485 filed?

1. The below threads talk about these.
Tax: https://www.canadavisa.com/canada-immigration-discussion-board/threads/tax-challenges.715793/
https://www.canadavisa.com/canada-immigration-discussion-board/threads/taxes-payroll-working-in-us-living-in-windsor.551077/

PR and GC: https://www.canadavisa.com/canada-immigration-discussion-board/threads/maintaining-residency-on-both-us-and-canadian-side-contact.715219/

H1: https://www.canadavisa.com/canada-immigration-discussion-board/threads/us-gc-i-140-petition-after-getting-canadian-citizenship.715759/
https://www.canadavisa.com/canada-immigration-discussion-board/threads/working-remotely-from-canada-while-on-h1b.616600/page-4

Can a cross-border commuter even apply for I-485?

 

[harirajmohan]

Can a cross-border commuter even apply for I-485?

Applying should not be a problem as you are still on H status but many lawyers dont recommend while commuting. I think that once the candidate decides to use Advance parole or green card then he/she needs to move to US as one cant maintain primary residence in both border nations and commute. Or consular processing to be done if lawyer doesnt agree.
Or commuter green card is the option to continue commuting.

 

[canprofus]

Applying should not be a problem as you are still on H status but many lawyers dont recommend while commuting. I think that once the candidate decides to use Advance parole or green card then he/she needs to move to US as one cant maintain primary residence in both border nations and commute. Or consular processing to be done if lawyer doesnt agree.
Or commuter green card is the option to continue commuting.

Consular process is the only way as far as I researched.

i feel commuter green card is not going to work if someone is not a Canadian citizen. one may get away with commuting using it, but it will be very hard to convince Canadian citizenship officer that you intend to settle in Canada because you have immigrant visa in US.. not sure what they could do.. they may ask to give up on it or they may delay the citizenship application indefinitely.

also commuter GC requires stable job offer in US, so it is not clear what could be done for family members who don't commute for work.. that means kids will not be able to get GC with us. above everything, days of commute will not get added for US citizenship as well.. so i am not sure what's the point of trying to get commuter GC at all unless one is keen on settling only in Canada, not in US.