Question about working in Canada on PR with US employer.

[FMeg]

How does this work? I used to work in the US on H1B, converted to H4 and then moved to Toronto on PR. My spouse is still in the US on H1B.

My old boss has a small start up and is willing to let me work remote from Canada on contract basis (Not W2).
How would payroll work? I have a valid H4 visa (no EAD) so I can't get paid to any of the US accounts ?.
Has anyone used a GEO or set up their own company for payroll as a contractor?

I know you won't get double taxed. But how complex is this?

 

[lampbreaker]

You can certainly get paid in a US account (or any country) in USD. From immigration perspective, you are physically working in Canada and you have the necessary work authorization in Canada (being a PR).

As an independent contractor, your employer will not withhold any taxes. You will be responsible for paying your taxes (to Canada since you are working in Canada). You don't need to set up any company, just work directly in your own capacity.

 

[FMeg]

I will be visiting the US to see my spouse from time to time. I guess I would need to apply for a B1/B2 visa to avoid getting into trouble for violating the H4 status.

 

[akkoajangajang]

As an independent contractor, your employer will not withhold any taxes. You will be responsible for paying your taxes (to Canada since you are working in Canada). You don't need to set up any company, just work directly in your own capacity.

I’ve been trying to wrap my head around this because I’ll be attempting something similar next year (I’m already a PR but I’m currently in the USA employed on an H1b. I want to move to Canada early next year. My employer seems to be supportive and my plan is to work for them as a contractor (they have no legal presence in Canada)).

I was assuming I would need to set up a company in order to be a contractor (I believe this is also the advice that is usually given to people on this forum who ask about contracting for US companies). Your answer makes me think otherwise. When would setting up a company be absolutely necessary for a contractor?

Also, from what I’ve read so far, if I set up a company, it would have to be a sole proprietorship since due to the nature of my software dev job, setting up a Corp would be pointless because of personal services business rules that would preclude me from availing of any small business deductions or dividend exemptions. Is that correct?

 

[lampbreaker]

I’ve been trying to wrap my head around this because I’ll be attempting something similar next year (I’m already a PR but I’m currently in the USA employed on an H1b. I want to move to Canada early next year. My employer seems to be supportive and my plan is to work for them as a contractor (they have no legal presence in Canada)).

I was assuming I would need to set up a company in order to be a contractor (I believe this is also the advice that is usually given to people on this forum who ask about contracting for US companies). Your answer makes me think otherwise. When would setting up a company be absolutely necessary for a contractor?

Also, from what I’ve read so far, if I set up a company, it would have to be a sole proprietorship since due to the nature of my software dev job, setting up a Corp would be pointless because of personal services business rules that would preclude me from availing of any small business deductions or dividend exemptions. Is that correct?

You should consult a lawyer about this. From what I understand, people do it through a company to limit liability, tax reasons etc., but they don't have to be employed through a company.

 

[SraCan]

I’ve been trying to wrap my head around this because I’ll be attempting something similar next year (I’m already a PR but I’m currently in the USA employed on an H1b. I want to move to Canada early next year. My employer seems to be supportive and my plan is to work for them as a contractor (they have no legal presence in Canada)).

I was assuming I would need to set up a company in order to be a contractor (I believe this is also the advice that is usually given to people on this forum who ask about contracting for US companies). Your answer makes me think otherwise. When would setting up a company be absolutely necessary for a contractor?

Also, from what I’ve read so far, if I set up a company, it would have to be a sole proprietorship since due to the nature of my software dev job, setting up a Corp would be pointless because of personal services business rules that would preclude me from availing of any small business deductions or dividend exemptions. Is that correct?

Hi,
In a similar situation currently. How did it work for you as an independent contractor(IC)? My employer agreed to me being an IC. Could you please elaborate on how this will work and what needs to be done from my side for the taxes.