A question about independent contractors and clause on tax forms...

[LdiJ]

Please read Canada's Regulation 105.

Again, bjohnson needs to speak with a professional in his area of Canada.

That regulation applies to person who are non residents who are providing a service IN Canada.

Section 105 of the Canadian Income Tax Regulations (“Regulation 105”) stipulates that "every person paying to a non-resident person a fee, commission or other amount in respect of services rendered in Canada, of any nature whatsoever, shall deduct or withhold 15 per cent of such payment" and remit it to the Canada …

Again, Quincy, please provide an example of how someone could be a non citizen or resident of Canada, living and working somewhere other than Canada, yet still be proving a service IN Canada.

 

[Taxing Matters]

Please read Canada's Regulation 105.

I have read it. And it is consistent with what I have said. It addresses the obligations with respect to personal services provided within Canada. Where the teachers are providing the personal services outside Canada that regulation does not apply. And it is worth pointing out that to the extent the regulation is inconsistent with the treaty, the treaty generally governs. It is the nearly universal approach of nations to consider the situs of income taxation for personal services to be where the services are actually performed.

Again, bjohnson needs to speak with a professional in his area of Canada.

I agree, and said as much before.

 

[quincy]

... I agree, and said as much before.

Good. That bjohnson should seek assistance in Canada should have been all that needed to be said originally.

 

[Taxing Matters]

Good. That bjohnson should seek assistance in Canada should have been all that needed to be said originally.

I see no problem in providing some general information to help point people in the right direction as to how things work — when I have that information to provide. So I'll continue to do so, though I respect your different view on the matter. I'll not try to control how you post if you don't try to control mine.

 

[quincy]

I see no problem in providing some general information to help point people in the right direction as to how things work — when I have that information to provide. So I'll continue to do so, though I respect your different view on the matter. I'll not try to control how you post if you don't try to control mine.

I wasn't trying to control how you post. However this forum as a rule does not assist posters from other countries because this site is for US law only.

Your earlier post said that you do not know Canadian law. I think the best advice to offer given that you don't know Canadian law is to tell the Canadian poster to seek advice in Canada. You did advise that and it was smart advice. I didn't object to anything you said, by the way.

 

[LdiJ]

I wasn't trying to control how you post. However this forum as a rule does not assist posters from other countries because this site is for US law only.

Your earlier post said that you do not know Canadian law. I think the best advice to offer given that you don't know Canadian law is to tell the Canadian poster to seek advice in Canada. You did advise that and it was smart advice. I didn't object to anything you said, by the way.

But you objected to what I had to say even though I conveyed the same information, and also said that it would be a good idea to consult a lawyer in Canada.

 

[Zigner]

But you objected to what I had to say even though I conveyed the same information, and also said that it would be a good idea to consult a lawyer in Canada.

No, he objected to your blanket statement on the matter.

 

[LdiJ]

No, he objected to your blanket statement on the matter.

What I said was accurate.
What Taxing Matters said was accurate.
What Quincy said (with the exception of contacting an attorney in Canada) was completely and totally inaccurate.

 

[Zigner]

Canadian companies pay lots and lots of representatives/agents/vendors in the US and none of them are subject to Canadian income tax.

You can't be sure of the accuracy of this statement. You need to avoid such blanket statements...really.
(That's my input on this - and I'll stop at this point)

 

[quincy]

What I said was accurate.
What Taxing Matters said was accurate.
What Quincy said (with the exception of contacting an attorney in Canada) was completely and totally inaccurate.

I said nothing inaccurate. Please reread exactly what I said and how I said it. Reread exactly what Taxing Matters said and how he said it.

Your seeming inability to write without making frequent blanket statements is a problem, LdiJ.

 

[LdiJ]

I said nothing inaccurate. Please reread exactly what I said and how I said it. Reread exactly what Taxing Matters said and how he said it.

Your seeming inability to write without making frequent blanket statements is a problem, LdiJ.

One of your first statements was:

I disagree with LdiJ. There will be withholding forms or waivers that will be needed.

Which as not accurate and was pretty blanket under your definition of blanket.

One of your further statements was that regulation 105 would apply to people residing and working outside of Canada. In fact you insisted on it several times. That also was not accurate.

You finally stopped arguing about it when Taxing Matters gave the same information, but even then you would not admit that you got it wrong.

 

[eerelations]

OK. I have been a senior-level HR Director for 30+ years, working for Canadian-based multinationals and managing the employment of many American ICs. Here's what OP needs to do to be legal:

1. Establish a business presence in the US.
2. Research American IC vs employee laws.
3. If the people he's planning to hire fall within the US definition of IC, issue them 1099s and pay them via accounts payable in US dollars.

 

[quincy]

And bjohnson should seek assistance in Canada.

 

[LdiJ]

OK. I have been a senior-level HR Director for 30+ years, working for Canadian-based multinationals and managing the employment of many American ICs. Here's what OP needs to do to be legal:

1. Establish a business presence in the US.
2. Research American IC vs employee laws.
3. If the people he's planning to hire fall within the US definition of IC, issue them 1099s and pay them via accounts payable in US dollars.

I have a goodly number of Independent contractor clients who are NOT paid with 1099s out of Canada or with US bank accounts. ; They are however paid in Canadian US dollar accounts. I agree that they would have to establish a presence in the US to have employees.