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Rakhi Vasavada
Rakhi Vasavada, Financial and Legal Consultant
Category: Finance
Satisfied Customers: 4542
Experience:  Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
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Just Answer, since last taxation year, I have worked in part

Customer Question

Hello Just Answer,
since last taxation year, I have worked in part physically in Canada, and online for a U.S. party (paid in U.S. funds). Here are details to help further clarify my case:
- I reside in Canada, and never left the country
- I worked at a Canadian business' physical location, while;
- I worked online for a U.S. party from my Canadian residence
Shall I still be required to file a W-9 form, a W8Ben instead, or a 1040NR(A)? Does a tax treaty still exist between U.S. and Canada and exemption apply?
Thank you in advance!
Submitted: 1 year ago.
Category: Finance
Expert:  Rakhi Vasavada replied 1 year ago.

Dear Friend,

Hello and welcome. Are you a US Citizen ?

Warm Regards,

Customer: replied 1 year ago.
Hello Rakhi Vasavada,I am a Canadian citizen, and considered nonresident as I am not a U.S. citizen, nor do I possess a green card.
Expert:  Rakhi Vasavada replied 1 year ago.

Hello,

Thank you for your reply.

I believe you are being withheld tax in US while receiving income from there. In that case, you will require Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding. Yes, there is a treaty to avoid double taxation and this is the very purpose of this form.

I am sure this would help.

You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.

Warm Regards

Customer: replied 1 year ago.
Hello Rakhi Vasavada,thank you for your reply. I require clarification on the following:- the U.S. party has not withheld any taxes, so I will still be required to pay U.S. taxes after filed with IRS, correct?
- do I include the W-8BEN as part of my Canadian filing, or will I be given another form by the U.S. party?
- in what currency would Canada calculate taxation (U.S. funds or converted to CAD)?
Expert:  Rakhi Vasavada replied 1 year ago.

Dear Friend,

Hello again. In this case you need no form.. Nothing.

This form is required ONLY if your tax is withheld (Deducted at source in US) and if you need to claim its credit back there in Canada.

If it is not being withheld, you need no forms at all. You will just report ALL of your income in your Canada Tax Filing, including the one obtained from online work. If there is no tax withheld, there is no question of double taxation OR claiming credits.

The US dollars will get converted at prevailing exchange rate once they arrive in your Canada bank account. That CAD will be accounted for while calculating your income.

I am sure this would help.

You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.

Warm Regards

Customer: replied 1 year ago.
Hello Rakhi Vasavada,thank you again for your reply. While I understand the W-9 form in non-applicable, aan a U.S. party still legally request the nonresident alien to fill out this form, and if so, would it serve any purpose?
Expert:  Rakhi Vasavada replied 1 year ago.

Dear Friend,

Sorry for a delayed response. No, I see no reason as to why a US Party should insist on this. From what I understand from your situation, it would serve no purpose for you or them unless they are deducting / withholding any tax from your payments.

I am sure this would help.

You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.

Warm Regards