Few questions about starting a business (full time to contract) as a non-resident

[dipens]

I am currently a full time employee in Ontario and a permanent resident. Due to unforeseen circumstances, I need to move back to my home country and I am afraid, I will not be eligible to renew permanent residence or apply for citizenship.

However my employer wants to continue employing me and is okay with me working remotely with the exception that I need to switch from full time to contract. I was asked to register for a HST number and invoice them every month and charge them HST as well since my income will be more than 30K ( I am guessing this is Sole proprietorship but correct me if I am wrong)

Now my question is, how will being a non-resident affect all of this? I have few questions regarding this:

• Can I get and continue to use the HST number after I become a non-resident.
  
  
• Is Sole proprietorship the way to go? Or do I need to incorporate?
  
  
• What happens when my residency status is no longer valid? Can I continue operating the business?
  

I appreciate any advice given. Thanks.

 

[sikka1984]

If you are able to hold on to your PR status as per renew of 2 years in 5 years you should be good to renew even if you live outside Canada. Your employer must pay you in Canadian account and you must pay yearly HST. I believe you need not to be in Canada in this case.. check cic for PR status renewal

 

[Copingwithlife]

Yes you can, however the structure of your HST account will change. If you originally registered as a resident then proceeded to be a non resident and still are providing services in Canada, you would contact the CRA and they would give you the contact information for the non resident office that would service the country you are now a resident in. There are different rules for non residents versus a resident.
You can invoice monthly, then choose how often you want to file the returns with the CRA, either monthly, quarterly or annually . Once you register, the 30K threshold you mentioned no longer applies. After you register, moving forward you would collect the HST on your invoices and remit to the government.
Whether you go as a sole proprietorship or a corporation is really up to you, so I would suggest you contact an accountant. Because if you are moving overseas you are now talking about tax treaties. However, once you incorporate, you are then automatically assigned a Corporation Income Tax account, and you are required to file T2 corporate returns every year, regardless if your corporation is active or not. Failure ti file can result in penalties. Filing a T2 is not cheap, and you have to keep your charter active whether you incorporated thru a province or Federal Government.
Here are some links to look thru. And one day you will close the account, Closing a corporation is far, far more complicated then closing a sole prop HST account, You are getting into requesting a Letter of Consent from the province, doing the Article of Dissolution, filing the last tax return. And it is not free. Closing a HST account, for a resident typically involves calling the CRA, closing a non resident HST account, involves dealing with the Tax Services Office assigned to the country you are in.
RC4022 for resident HST information, links below for non resident information

https://www.canada.ca/en/revenue-agency/corporate/contact-information/non-resident-gst-hst-enquiries.html

https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4027/doing-business-canada-gst-hst-information-non-residents.html