In Canada with a Client from USA


1

I'm located in Ontario, Canada. I'm in talks with a company in the United States to do a software contract. We met here in Canada.

I'm wondering what the tax and regulations of such a contract would be. I know between provinces you are supposed to charge tax based on the location of the buyer, e.g. if I sold a product to someone in Alberta I would charge the Albertan Tax rate. How does this work with the USA?

Tax Canada USA Global Customers

asked Sep 12 '13 at 06:12
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Philip K
166 points

1 Answer


1

Generally jurisdiction is based on either citizenship (entity registration location for non-persons) or physical location.

If you're neither US citizen (Or an entity registered in the US) nor US resident (physically present in the US) - US has no jurisdiction over you.

Your client might have some issues remitting payments to a foreign contractor and you may need to file non-resident tax return in the US to reclaim potential tax withholding, but your client will have to figure it out, and only if something is actually withheld will you need to worry about it.

answered Sep 12 '13 at 07:13
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Littleadv
5,090 points

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Tax Canada USA Global Customers