US Citizen hired by CDN company - David Ingram

QUESTION:
I've been offered a "part-time" VP of Corporate Bus. Development for a
Canadian start-up (5 days per month) ... essentially a consulting
arrangement, but with a VP title.
If they pay me as a consultant, do I owe both US and Canadian taxes (I'm a
WA state resident, US Citizen)?
If they consider me an employee, do I owe both US and Canadian taxes?
I have a US-based sole-proprietorship licensed in Washington state...can I
just add the consulting salary to my proprietorship revenues and pay US
taxes on the consulting income?
Thanks!
====================
david ingram replies:
Although you maybe able to get a TREATY NAFTA management consultant visa, it
is unlikely that you would be able to get a visa to come to Canada to work
as a V-P for 5 days a month.  You should turn down the title unless it only
applies to your duties performed in the USA. In a similar situation, we
obtained a TN visa as a management consultant for the Canadian General
Manager of a US company.  The Canadian General Manager was a specialist and
we got him a Management consultant visa to go to various cities in eh US and
advise the local managers on who they should hire in their areas. They would
have several people picked out and our man would fly to Washington or New
Orleans or Salt Lake City, analyse the prospects and advise the manager
about who he suggested should be hired.
If you are commuting on a daily basis (5 days a month) as a genuine
consultant, I would say that you were not taxable in Canada under Article
XIV of the Canada / US income Tax Convention (treaty).
However, your description of the position pf V=P means that you must really
be an employee.
As an employee you are exempt from Canadian tax in any calendar year you
earn les than $10,000 under Article XV of the Treaty.  However, if you earn
$10,001, you are taxable in Canada on everything including the first $10,000
that "was" exempt $2.00 ago.
On the other hand, if your trip to Vancouver is a "fact finding" mission and
you gather information and then go back to your US office to do the actual
work, you do NOT need any visa to enter Canada.  You are merely entering as
a business visitor.
If you do pay tax to Canada including EI (Employment Insurance) and CPP
(Canada Pension Plan) The tax, CPP and EI are deductible against actual US
tax (you have to report the earnings again on your US 1040) on your 1040 by
claiming the Canadian Taxes on US schedule 1116.
You need to spend a few dollars and get the low-down on what you intend to
do.  A wrong slip could get you in Canadian Tax AND IMMIGRATION trouble.
Hope this helps and of course, I/we would be glad to help you.
david ingram
--------------------------------
 David Ingram's US/Canada Services
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
Home office at:
4466 Prospect Road
North Vancouver,  BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 10 AM to 10 PM 7 days a week (please do not fax or phone
outside of those hours as this is a home office)
email to taxman at centa.com <mailto:taxman at centa.com>
www.centa.com <http://www.centa.com/>  www.david-ingram.com
<http://www.david-ingram.com/>
Disclaimer:  This question has been answered without detailed information or
consultation and is to be regarded only as general comment.   Nothing in
this message is or should be construed as advice in any particular
circumstances. No contract exists between the reader and the author and any
and all non-contractual duties are expressly denied. All readers should
obtain formal advice from a competent and appropriately qualified legal
practitioner or tax specialist for expert help, assistance, preparation, or
consultation  in connection with personal or business affairs such as at
www.centa.com <http://www.centa.com> . If you forward this message, this
disclaimer must be included."
Be ALERT,  the world needs more "lerts"
David Ingram specializes in giving expert income tax and immigration help to
American and Canadian citizens living out of their home countries from
Zimbabwe to Saudi Arabia to Mexico to China or Chile - Cross border,
Non-resident - dual citizen - out of country investments are all handled
with competence and authority.
This from "ask an income tax and immigration expert" from www.centa.com
<http://www.centa.com/>  or www.jurock.com <http://www.jurock.com/>  or
www.featureweb.com <http://www.featureweb.com/> . David Ingram deals on a
daily basis with expatriate tax returns with:
multi jurisdictional cross and trans border expatriate problems  for the
United States, Canada, Mexico, Great Britain, United Kingdom, Kuwait, Dubai,
Saudi Arabia, Thailand, Indonesia, Japan, China, New Zealand, France,
Germany, Spain, Italy, Russia, Georgia, Brazil, Peru, Ecuador, Bolivia,
Scotland, Ireland, Hawaii, Florida, Montana, Morocco, Israel, Iraq, Iran,
India, Pakistan, Afghanistan, Mali, Bangkok, Greenland, Iceland, Cuba,
Bahamas, Bermuda, Barbados, St Vincent, Grenada,, Virgin Islands, US, UK,
GB, and any of the 43 states with state tax returns, etc. Rockwall, Dallas,
San Antonio Houston
Denmark, Finland, Sweden Norway Bulgaria Croatia Income Tax and Immigration
Tips, Income Tax  Immigration Wizard Antarctica Rwanda Guru  Consultant
Specialist Section 216(4) 216(1) NR6 NR-6 NR 6 Non-Resident Real Estate tax
specialist expert preparer expatriate anti money laundering money seasoning
FINTRAC E677 E667 105 106 TDF-90 Reporting $10,000 cross border transactions
Grand Cayman Aruba Zimbabwe South Africa Namibia help USA US
Alaska,  Alabama,  Arkansas,  Arizona,
California,  Colorado, Connecticut,
Delaware, District of Columbia,  Florida,
Garland, Georgia,  Hawaii,  Idaho,  Illinois,
Indiana,  Iowa,  Kansas,  Kentucky,
Louisiana,  Maine,  Maryland,
Massachusetts, Michigan, Minnesota,
Mississippi,  Missouri,  Montana,  Nebraska,
Nevada, New Hampshire,  New Jersey,
New Mexico, New York, North Carolina,
North Dakota,  Ohio,  Oklahoma,  Oregon.
Pennsylvania,  Rhode Island,  Rockwall,
South Carolina, South Dakota, Tennessee,
Texas,  Utah, Vermont,  Virginia,
West Virginia, Wisconsin, Wyoming,
British Columbia, Alberta, Saskatchewan,
Manitoba, Ontario, Quebec City,
New Brunswick, Prince Edward Island,
Nova Scotia, Newfoundland, Yukon and
Northwest and Nunavit Territories,
Mount Vernon, Eumenclaw, Coos Bay
and Dallas Houston Rockwall Garland
Texas  Taxman and Tax Guru  and wizzard
wizard - consultant - expert - advisor -advisors consultants - gurus - Paris
Prague Moscow Berlin
Lima Rio de Janeiro, Santaigo Zimbabwe
New York, Boston, Sacramento, Minneapolis, Salem, Wheeling, Philadelphia,
Pittsburgh, Atlanta, Pensacola, Miami, St Petersburg, Naples, Fort Myers,
Cape Coral, Orlando, Atlanta, Arlington, Washington, Hudson, Green Bay,
Minot, Portland, Seattle, St John, St John's, Fredericton, Quebec, Moncton,
Truro, Atlanta, Charleston, San Francisco, Los Angeles, San Diego,
Sacramento, Taos, Grand Canyon, Reno, Las Vegas, Phoenix, Sun City, Tulsa,
Monteray, Carmel, Morgantown, Bemidji, Sandpointe, Pocatello, Bellingham,
Custer, Grand Forks, Lead, Rapid City, Mitchell, Kansas City, Lawrence,
Houston, Albany, Framingham, Cambridge, London, Paris, Prince George, Prince
Rupert, Whitehorse, Anchorage, Fairbanks, Frankfurt, The Hague, Lisbon,
Madrid, Atlanta, Myrtle Beach, Key West, Cape Coral, Fort Meyers,   Berlin,
Hamburg
Warsaw, Auckland, Wellington, Honolulu, Maui, Kuwait, Molokai, Beijing,
Shanghai, Tokyo, Manilla, Kent, Winnipeg, Saskatoon, Regina, Red Deer, Olds,
Medicine Hat, Lethbridge, Moose Jaw, Brandon, Portage La Prairie, Davidson,
Craik, Edmonton, Calgary, Victoria, Vancouver, Burnaby, Surrey, Edinburgh,
Dublin, Belfast, Glasgow, Copenhagen, Oslo, Munich, Sydney, Nanaimo,
Brisbane, Melbourne, Darwin, Perth, Athens, Rome, Berne, Zurich, Kyoto,
Nanking, Rio De Janeiro, Brasilia, Colombo, Buenos Aries, Squamish,
Churchill, Lima, Santiago, Abbotsford, Cologne, Yorkshire, Hope, Penticton,
Kelowna, Vernon, Fort MacLeod, Deer Lodge, Springfield, St Louis, Centralia,
Bradford, Stratford on Avon, Niagara Falls, Atlin, Fort Nelson, Fort St
James, Red Deer, Drumheller, Fortune, Red Bank, Marystown, Cape Spears,
Truro, Charlottetown, Summerside, Niagara Falls, Albany Zimbabwe
international non-resident cross border income tax help assistance expert
preparation & immigration consultant david ingram, experts on rentals mutual
funds RRSP RESP IRA 401(K) & divorce preparer preparers consultants

Trackback

Trackback URL for this entry: http://www.centa.com/trackback.php/UsCaWeekofMon20060213002398.html

No trackback comments for this entry.

0 comments