NAFTA Visa

I have a question. I am Canadian who received NAFTA visa to work in the USA. The USA company has a canadian branch. Can I still get paid out of the Canadian branch? It is easier for me to get paid from canada for many reasons, e.g. mortgage payments, insurance, family still in Canada. Please advise. Thanks

The exchange rate wouldn't have something to do with it, would it? Or is it you don't want to pay taxes here and there?

In reply to minimac:

I will pay taxes there (Canada). the interest rate is not the issue. My question is more like legal issue. Is this kind of arrangment allowed by USA?

Absolutely. It's entirely up to the employer. I worked in Canada for a U.S. contractor. They paid us from their US office. In this case it was easier for them since we were all Americans. We were liable for Canadian taxes though, and they were withheld in addition to NY taxes and fed taxes. They made it worth our while but it was a hassle at tax time. As a bonus though I have money into a Canadian pension.

I thought that after you had resided in the US for 6 months, the IRS came knocking. Thats why the snowbirds always spend 6 months and a day in Canada every year.

If you are working south, but coming home every weekend, that would probably be a different story. What are the relative tax rates? Would you not be better off paying the lower US income tax rates?

The usual short answer - go see a CPA with a clue.

I would expect that Canada and the US have a double taxation treaty so you don't end up having to pay taxes twice on your income, but you'll most likely have to put in a tax return in both places.

BoxheadTim wrote: I would expect that Canada and the US have a double taxation treaty so you don't end up having to pay taxes twice on your income, but you'll most likely have to put in a tax return in both places.

Yup, I live in Canada but work in the US. I do my US taxes first, just like an American would, then I do my Canadian taxes just as if I were working in Canada, but I can deduct everything I paid in the US (fed, state, medicare, SSI etc) from my Canadian taxes. I usually end up paying a tiny bit in Canada.

Back to the original question, I don't know if it's legal, though a company I worked for wanted to do it that way. I was working in Michigan for a company that also had locations in Canada. They were not able to enter a Canadian address into their US payroll system so they could not pay me, so they were going to pay me through their Canadian side. I came up with a US address they could use though, so it never happened. Just because they were willing to do it though, doesn't mean it's legal. Did the company use a lawyer to create the TN paperwork or did they write it themselves? If they used a lawyer you may want to give them a call.

Bob

I have a TN and work in the US, but my paycheque (yes) is in $cdn and all of my taxes are too.

Same situation as you I think - live in Canada and work in 'Murica.

In reply to akamcfly:

So what did you do with your annual tax return? did you file 2 taxe returns, one for each country? Thanks

In reply to Schmidlap:

yes the have a lawyer, he did the TN himself. I will ask him. Thanks

In reply to Streetwiseguy:

of course I would! Is it lower tax rates in USA than Canadian?

ron1339 wrote: In reply to akamcfly: So what did you do with your annual tax return? did you file 2 taxe returns, one for each country? Thanks

It's my 5th year doing this job and have only filed Canadian tax returns. I get paid through the Canadian "branch" in Canadian dollars and live in Canada. I just commute to the US to work every day.

I don't know much about it, but are you claiming the "overseas tax credit"? A friend of mine was working for a Canadian company but spending all of his time in the US and was able to get stupid amounts of money back (he didn't know about this tax credit until he had an accountant do his taxes after three years) after learning about this tax credit. According to the internet, it eliminates 80% of your taxable income in Canada, as long as you qualify.

Bob