Working remotely for a US company and confused about where you pay taxes? The short answer is: where you live. The long answer is complex.

1. HOW TO FILE A
REMOTE WORK
TAX RETURN

2. HOW TAXES WORK FOR A
REMOTE CANADIAN WORKER
In Canada, tax obligations are determined by residency rather
than citizenship, immigration status, or employer. Working in
Canada requires Canadian citizens, foreign workers, and visa
holders to pay income tax. Whether you work for a local or global
company, if you work remotely in Canada, you must pay taxes in
Canada.
Both your employer and you are required to pay taxes in the
province you are based in.

3. TAX IMPLICATIONS OF
WORKING REMOTELY
Remote workers pay federal and provincial/territorial income taxes,
as well as contribute to Employment Insurance (EI) and the
Canadian Pension Plan (CPP), just like any other worker in Canada.
Working remotely, however, has several unique tax implications:
Home Office Expenses: You may be able to claim certain home
office expenses, including a percentage of your rent, phone,
internet, and utilities.
T2200: As a remote worker, your employer should provide you
with a T2200 form that details taxable and nontaxable
expenses, along with any allowances you received.

4. TAX IMPLICATIONS OF
Receipts and Records: According to the CRA, you should keep
a copy of your return and all supporting documents for six
years, including receipts and your T2200.
Worker Misclassification: Employees and contractors are
subject to varying tax and labour laws depending on their
employment relationship. If you are misclassified, you may face
fines and retroactive taxes.
cont.
WORKING REMOTELY

5. TAX IMPLICATIONS OF
Working as a Contractor: The tax implications of working
remotely are very different for sole proprietors and incorporated
contractors.
Sole Proprietors are businesses of one person and bear the
responsibility for all the liabilities. On a quarterly basis, they
collect and remit their own income taxes.
Incorporated Contractors are small businesses with the
owner as an employee. They manage their own payroll and
file a tax return with the CRA.
cont.
WORKING REMOTELY

6. Date Information
01 January 2022 The start of a new tax year.
22 January 2022 E-file service is closed for maintenance.
24 February 2022 E-filing is open for residents and immigrants in Canada for the 2021 tax year.
15 March 2022,
15 June 2022,
15 September 2022,
15 December 2022
Due dates for instalment payments in 2022.
28 February 2022 Last day to issue T4s, T4As, and T5s to employers and CRA (Canada Revenue Agency).
02 March 2022 The deadline to make an RRSP contribution for the 2021 tax year.
22 April 2022 The deadline to set up pre-authorized debit payments for the year 2020.
30 April 2022 (extended to 2
May because 30 April is
Saturday)
Deadline to file 2021 tax returns for individuals and pay any balances owed to the CRA.
15 June 2022
The deadline for self-employed in Canada to file their tax returns for the year 2021. If there is a balance
due for 2021, it must be paid before April 30, 2022.
31 December 2022 The last day of the tax year.
IMPORTANT DATES
This calendar will help you remember the following key tax deadlines in Canada in 2022:

7. PENALTY FOR LATE TAX-FILING
$5,000 x 5% = $250, plus
$5,000 x 1% x 12 months = $600
The CRA imposes an immediate penalty of 5% of your tax balance
outstanding, plus 1% of your balance owing per month for up to 12
months.
For example, If you owe $5,000 in taxes and file your tax return a
year late, your tax bill will be:
Late-filing penalty = $850, raising your total tax bill to $5,850.
The additional interest penalty is not included.
The CRA has the authority to increase your "late-filing" penalty to
10% of your tax balance plus 2% each month for up to 20 months. If
you've been late with your taxes in the past.

8. HOW WE CAN HELP
Canadian Payroll Services, as an Employer or
Record, ensures that remote employees
receive proper tax documents and keep
employees and contractors alike in
compliance by managing expenses and
employment contracts.
Contact us to learn more about how working
with an EOR like Canadian Payroll Services can
help you with remote work and taxes.

9. GET IN TOUCH
EMAIL ADDRESS
info@canadianpayrollservices.com
PHONE NUMBER
1-416-537-7244
LOCATION
Suite 4357 – 1460 The Queensway,
Etobicoke, Ontario M8Z 1S4 Canada

10. THANK YOU