I live in Quebec Canada I work online for the United States, I get paid weekly by US check. I have never been to the United States. My boss is telling me I might not have to pay any taxes because I live in canada and work for the United States. He said I will receive a 1099 slip what do I do with that? Do i have to pay taxes to the US or Canada or both? HOw does this work I am concidered to be my own boss.
2007-09-24 21:54:24 · 5 answers · asked by kimberleigh 1 in Business & Finance ➔ Taxes ➔ United States
Did your US payee require you to get an EIN or ITIN for US tax purposes? Did your US payee withhold any of your pay for taxes?
You won't have to pay US taxes, but you will have to file a Form 1040NR to get any withholding that has been taken by your US payee. If you provided an EIN or ITIN, your payee may issue you a 1099 and show withholding.
You may be required to file a tax return and owe income tax to Canada.
2007-09-25 04:35:10 · answer #1 · answered by ninasgramma 7 · 0⤊ 0⤋
You will pay taxes in Canada only as you are not working in the US and are not subject to US tax laws. PERIOD.
Your "boss" cannot send you a Form 1099 because you do not have a US SSN or ITIN and cannot be compelled to get one. The 1099 filing would be rejected by the IRS if he tried to cut one without a SSN.
You may work for a US-based company but you do NOT work for the US.
Contrary to the claim of another poster, the 30% source tax is ONLY for investment income. Payments for services rendered are NOT subject to the 30% source tax.
2007-09-25 06:07:11 · answer #2 · answered by Bostonian In MO 7 · 1⤊ 0⤋
A 1099 is telling me you have to pay your own taxes.
In the United States an individual who receives a 1099 Miscellaneous form has to pay their own Federal, State, City Tax (if applicable), Social Security, and Medicare Tax.
They are supposed to mail in quarterly payments to pay their taxes, otherwise they could be charged interest and penalties for not paying their taxes on time.
These are called Employment Taxes.
You may recieve a deduction for the taxes you pay in the United States, due to the North American Free Trade Agreement and pay employment taxes in Canada.
Honestly, you need to speak to a tax professional in Canada who prepares taxes for individuals who live in Canada and are Canadian residents, but work in the United States.
You have income earned in the United States, which is taxable, the income is considered to be taxable in Canada, and you should receive a deduction or credit, which will decrease the amount of tax you have to pay.
Never believe, "You don't have to pay taxes." Those words get people in trouble.
2007-09-25 05:08:47 · answer #3 · answered by dd 4 · 0⤊ 1⤋
bostonianinmo is correct. You will not get 1099 and you will not file the U.S. return.
Normally, the U.S. employer is expected to withhold tax at 30% to a foreign payee. If the employer is not withholding tax, then may be it is because of the tax treaty between the two countries.
2007-09-25 06:53:30 · answer #4 · answered by MukatA 6 · 0⤊ 0⤋
inquire in Canada embassy through tax remittances if you are going to pay in your government or in US. Or proceed to nearest BIR office to relate your situation.
2007-09-25 05:00:36 · answer #5 · answered by wilma m 6 · 1⤊ 1⤋