INTERNET sales by Canadian from computer and employer

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My question is: Applicable to both US and Canada
I'm a Canadian citizen that lives in Vancouver.
I receive monthly sales commission from US StateXXX every month. These are
related to services I perform on the internet. These commissions total
$180,000 US a year.
My questions
Am I required to pay GST on these sales?
And is it better to pay the tax in Canada or some of it in the US/ balance
in Canada?
I will be receiving a US tax form with my earnings on it from US StateXXX.
david ingram replies:
Well, the good news is that it does not matter.  Your ultimate tax on
EVERYTHING will be paid to Canada.  Any tax paid to Oregon and the US
federal government will be a foreign tax credit and should be / will be
deducted from any tax paid to the USA.
Now what is the problem, here? If you had asked me the same question a year
ago, I would have been adamant that you had NO US tax liability whatsoever.
However, since then, the State of New York won a tax case where they taxed a
Nashville, Tennessee man on the earnings he received from a New York
Employer for work he did on the New York Employer's computer in New York,
even though he was physically in Nashville.  He lost it on the first appeal
and I do not think he has appealed it further so for the state of New York
at least, working on a New York State computer over the internet makes you
taxable in New York.
In your case, it sounds like you will be getting a W2 or a 1099 or a 1042S
reporting your earnings as from Oregon.
I suggest that you file accordingly and pay the tax there and then claim the
credits on your Canadian return.  Glad to prepare them for you.
And, of course, if the money was all earned from sales to US buyers, there
is no GST.  If "YOU" know that you made 10% of your sales back to Canada,
then 7% GST should be paid on that percent of your income but you will also
get to deduct the GST you have paid out earning it all.  That would include
GST on the purchase of your computer (assuming you received a 1099 or
1042S), GST on your internet access and other expenses you can deduct. If
you receive a W2, you can NOT deduct the GST but you do NOT owe it either
but we have to change the method of paying you for the future.
If you are self-employed, we / you DO NEED to file a GST return whether you
owe GST or not because your income was over $30,000 Canadian.
----------David Ingram's US/Canada Services
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