Far away destinations can be exotic and exciting places to work and live, but do you know the costs and risks involved? The global mobility tax team at Grant Thornton does.
Whether you’re moving to or from Canada permanently, accepting a temporary assignment abroad, studying abroad or just seeing the world, the planning and coordination of Canadian and foreign country tax laws can be a daunting task. Mistakes can be costly.
When relocating to a new tax jurisdiction, there are many questions and issues that need to be considered both before and after your international move:
• How will Canada tax me?
• What factors determine if I am a Canadian resident or not?
• What income is reported in which country?
• Who will prepare my tax returns?
• When are they due?
• Will I be subject to social security tax in Canada (i.e.,
Canada pension plan contributions) and/or the foreign country?
• Will my moving costs be deductible?
• If my company pays for the moving costs, is that a taxable benefit?
• Do I have to sell my home or can I rent it out?
• What is "tax equalization" and when does it apply?
• What is Canada's departure tax and will it apply to me?
• Who In addition to my regular salary, my company is paying me a
foreign housing allowance and cost of living allowance (cola)—
how are these treated?
• What is a "hypothetical tax" and will it apply to me?
If you're the employer managing an expatriate workforce, questions regarding tax implications of relocation arise as well:
• What obligations do I have to withhold and remit foreign and/or
• Will I still have to issue a T4?
• Will the company create a "Permanent Establishment" by transferring
You need answers.
Grant Thornton Global Mobility professionals are ready to solve both the employee and employer side of the expatriate tax equation. Our integrated team includes home and host country professionals in over 100 countries. By interfacing with our Grant Thornton International member firm tax specialists, we are able to take the worry out of compliance and planning for international assignees.