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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22359
Experience:  Taxes, Immigration, Labor Relations
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I am a canadian resident contracting for a US company. What

Customer Question

I am a canadian resident contracting for a US company. What forms do I have to file in the US to avoid pay US tax
Submitted: 2 years ago.
Category: Tax
Expert:  Lev replied 2 years ago.

LEV :

Hi and welcome to Just Answer!
Are you working in the US or in Canada?

Customer :

I will be doing 3 days in the US for this company. They will be paying me via their accounts payable function

Customer :

They asked me to complete a W9 which I can not do (I dont think so anyway) As I am not a US resident

LEV :

"doing 3 days in the US" - does that mean - you will be working in the US? Your workplace is in the US - correct?

Customer :

I will be working in their offices in the US

Customer :

It is only a 3 day contract

LEV :

Your income from US sources (based on th elocation of your workplave in the US) is exempt from US taxes

if it is not more than $10,000,
If that is trues - you need to provide form W8BEN - www.irs.gov/pub/irs-pdf/fw8ben.pdf - and will claim exclusion based on teh US-Canada tax treaty.

Customer :

OK but do they need me to supply something to them to prove that taxes are being paid on this income. That is why they originally asked for a W9

LEV :

If your income is more than $10,000 - it is taxable in the US - but you will be claim a credit for US taxes on your Canadian tax return - thus effectively will avoid double taxation.

LEV :

" to prove that taxes are being paid" - if you mean Canadian taxes - that is not their concern. They only concern about US taxes because that is US employer.

Customer :

OK. It is under $10,000 but they still want me to complete a W9. Is there an equivalent to the W9 for non resident US contractors

LEV :

you need to provide form W8BEN - www.irs.gov/pub/irs-pdf/fw8ben.pdf - and will claim exclusion based on teh US-Canada tax treaty.

LEV :

That is based on ARTICLE XV Dependent Personal Services - see page 22 in the tax treaty document - http://www.irs.gov/pub/irs-trty/canada.pdf

Customer :

OK I take it I am the beneficial owner on this form then and not my client

LEV :

Please provide then W8BEN form and mention ARTICLE XV of the US-Canada tax treaty.

Customer :

ok I am a sole trader so should I tick the individual box in section 3 and only tick 9a and then complete the treaty information in section 10

Customer :

Also should I put zero in the withholding tax rate in section 10

LEV :

That is correct.
I am not clear with your statement - "I am a sole trader" - what do you mean? Are you trading securities?

Customer :

sorry it is a UK term for someone who contracts but is not a company or partnership or employed

Customer :

so on this form does that mean I am an individual is what I am asking

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