Canadian withholding, remitting and reporting requirements for non-residents working in Canada and Canadians working abroad


The following is a rebroadcast of a webinar aired on February 14, 2013. If you have any questions concerning this broadcast or any other questions, please contact us at 1-800-959-5525 or consult our Web site. Thank you.

Good afternoon, ladies and gentlemen. My name is Josh Drake and I've been working with the Canada Revenue Agency for about 13 years. I began my career with the International Tax Services Office, subsequently moved to the Headquarters office where I work with payroll obligations and, more specifically, taxable benefits. Thank you very much for joining us today on our presentation on cross-border issues and payments to non-resident workers working in Canada and Canadian residents working abroad.

I think we can safely say that businesses operate more and more both in Canada and abroad to remain competitive. That it be due to reorganization or consolidation of activities, we see more frequently situations involving cross-border movement of employees and service providers.

As a result, businesses will likely have non-resident employees coming to work in Canada or Canadian businesses having workers abroad. We will be discussing these situations in this presentation, especially the challenges relating to these withholding issues.

Now, our presentation is a general overview of the subjects that payers may have to deal with within the arena of cross-border workers. Now, each and every one of these subjects could be a presentation unto themselves. However, we can't cover all of these details in just 45 minutes. So, as such, it will be a broad overview of these topics, and I'll  review such concepts as: residency and taxation in Canada; whether the person you're paying is in fact an employee or a self-employed contract worker, which will have an effect on taxation; we'll have a quick glance at tax treaties and their effect on taxation; we'll look at situations involving employment income and your withholding obligations, as well as some situations with self-employed income or "services rendered in Canada" by a non-resident; and finally, we'll go through some scenarios that I'm hoping you'll find practical and understandable and comparable, for that matter, to some of your scenarios or some of the questions that you ask throughout the presentation. Hopefully, some of these scenarios will answer those.

Now, I would like to clarify today that we are not covering Quebec legislation nor are we covering any foreign jurisdictional requirements you may have. So if a resident works abroad or a non-resident works in Canada, it is possible that the employer may have some obligations in the foreign jurisdiction, and, if this is the case, what I would recommend is that you contact the local jurisdiction, say the IRS for instance, to see if you are meeting any obligations or have any obligations in that foreign jurisdiction.

Let's have a look at our first fundamental concept, which is taxation in Canada. So, under the Canadian income tax system, a person's liability for income tax is based on his or her status as a resident or non-resident of Canada and we'll expand on that a little bit further. So, a person's residency status must be established before their tax liability to Canada can be determined. Now, the determination of an individual's residency status involves a review of a number of factors that we call residential ties. Now, all of the relevant facts in each case must be considered and reviewed, including what residential ties does the person have with Canada? For instance, do they have assets in Canada, a home, bank accounts, a family, a spouse, etc., a job? We also look at the length of time passed inside or outside Canada, what is the object of the person's stay in Canada or outside Canada, and the intention of the person coming to Canada or leaving, what have you, depending on which residency side you’re on, and we will look at continuity with respect to stays in Canada and abroad. So these are some of the factors we'll look at when we're trying to determine your residency status. Now, a very important note: that residency status for tax purposes of an individual may be different from that person's citizenship or immigration status. These are two different factors entirely.

Residency determination is a matter of facts, as I mentioned. So an individual can self-determine their own status. Alternatively, they can request a residency determination by completing our NR73 or NR74 form, depending on if you are coming or going, and sending it to our international tax services office. Now, the questionnaire walks the user through a series of questions, which our international office will use to produce a letter of residency, determination, to the individual who can then present that to the employer, to ensure the employer's making the correct withholdings and deductions and reporting obligations. It's not necessarily the responsibility of the employer to make a residency determination but it is your responsibility for the proper deductions.

I just advanced to slide 6 here. And in all cases, the payer should take prudent measures to confirm the residency status of the person that they hire to work for them or to provide the service. Again, each case needs to be reviewed on a case-by-case basis, letters issued to make everybody a resident or non-resident. So it is important for the payer to know the person's residency status for tax purposes. Now, although payroll reporting and withholding rules are similar whether the employee is a Canadian resident or a non-resident, it is not always the case for all types of payments. The residency status of a person is essential for the payer to know, in order to establish which deductions will apply. For example, an employer pays a salary to a non-resident. Well, the deductions could be very similar to that of a Canadian resident. In fact, we will find that out a little later on. But what if the employer pays for a service from a self-employed non-resident? So, not an employee, but a self-employed person. The tax treatment would be different than if the person were a resident. So it is important to know the difference between these.

What is also important to remember with residency status is that it is not static and it may change over time. A payer should regularly verify to ensure that a person’s residency status has not changed. Now, although payers again, as I mentioned, payers are not responsible for determining the status, but you are responsible for the correct payroll obligations. So knowing that is very important.

Now, once the residency status of the person is established, the employer should establish whether the person working for them is, in fact, an employee or a self-employed individual or independent worker. And this too is a question of fact.

Now, the rules and traditional tests that apply to Canadian residents to make this determination will also apply to non-residents. You may want to consult our guide RC4110, entitled Employee or Self-Employed, which provide a myriad of explanations and examples. You will also find guidance on our Web site.

A quick note to say that I'll mention and I'll refer to guides and IC (circulars), etc., at the back end of the presentation, there will be three slides, which we will show, which will have all of the reference material that I have mentioned in here plus a host of other information.

Now, if after consulting these references, the worker or the employer still have doubts, either party can ask for a determination of the employment status from the CPP/EI ruling section of the local tax services office closest to where the services are to be provided. Now, an employer or a worker can request this ruling by sending a letter or a completed Form CPT1, so either or, a Request for a Ruling as to the Status of a Worker under the CPP and EI Acts. Now, if you have a payroll account and you are registered on My Business Account, you can use the "Request a CPP/EI ruling service" within that computerized arena. An authorized representative for the payer may also request a ruling electronically at Represent a Client. So, as you can see, there's several online tools available at your disposal to help with making this determination.

As I mentioned in the outline, we'll have a really brief look at tax treaties. And so, what is a tax treaty? Tax treaties, or tax conventions, as they are sometimes referred to, are bilateral agreements between two countries. They deal with the taxation of income and capital earned in one country by residents of another country, or the other country. You will sometimes hear references to protocols, and now protocols are simply amendments to existing tax treaties. Now, treaties do not impose taxes but they may reduce or eliminate tax or may reduce the holdings up-front on specific types of income that are otherwise taxable under the Income Tax Act. Now, where there's a conflict between the Act and the treaty, which sometimes can occur, the treaty will always take precedence over the Income Tax Act, and this is codified in the Income Tax Act. So, we have currently just under 90 conventions, I believe, that are in force and each treaty is different and unique. And you can get a copy of a tax convention through the Department of Finance Web site and, again, it will be listed on the back of the presentation, but I am often there doing research of my own.

A quick recap before we move on to the next section of the presentation. We've looked at residency and the importance of knowing the residency status of an employee, we've looked at whether the employee is self-employed or an employee, straight employee-employer relationship and the effect on taxation that may have on taxation, and whether tax treaties in force that may adjust or have effect on the withholding, and all of the tools available to you to help you with those types of things.

In the next few slides, we'll be dealing with remuneration from employment, employment income essentially, so that it be a resident of Canada working abroad or a non-resident of Canada coming to work in Canada, we'll look at the employer's responsibilities and obligations on this income.

Now, here is slide 11. Now, residents or deemed residents are subject to income tax in Canada on their worldwide income, so from all sources, while non-residents or deemed non-residents are taxable on the income earned within Canada. So, a very important distinction there. Now, employers will have responsibilities, of course, when employment income, including taxable benefits, are paid to a resident of Canada, certainly who is employed to work in Canada, a resident of Canada who is employed to work outside of Canada, and a non-resident of Canada who is employed to work in Canada. So, for the purposes of this presentation, we'll focus on the last two points. So, employees not resident in Canada who are in regular and continuous employment in Canada are subject to tax deductions in the same manner as Canadian residents. So, fairly simple there. A tax treaty, however, between Canada and the country of residence, a small nuance here, of a non-resident employee may provide relief from the Canadian tax deductions and we'll have a look at these possibilities as we discuss waivers a little further on.

The next question is: What are the employer's obligations? Well, we can see what the slide says here. If you are paying a salary, the employer is responsible for deducting from the salary Canada Pension Plan contributions, and that is both portions—that is, the employer's and the employee's portions, employment insurance premiums (again, both portions) and income tax. As well, individuals must complete a Form TD1, which is a tax credits form. And this applies to non-residents of Canada as well. But because non-residents may not be entitled to the same personal tax credits that a resident may, depending on how much income they earn in Canada, the TD1 form may be completed differently than residents. And more information regarding non-residents is on the back of the TD1 form. Now, the withholding regime is stipulated under subsection 153.1 of the Income Tax Act, and there is a reason why I'm quoting the Act here and I will explain it to you. So, 153.1 says: "Every person paying at any time in a tax year salary, wages or other remuneration, shall deduct or withhold from the payment an amount determined in accordance with the rules and regulations, or the prescribed rules", which are our regulations at the back of the Act. Now, I've quoted this because I wanted you to pay attention to the preamble that says "every person." Now, we use terms like "every person" and "any person," or we don't use them but we find them in the statutes, which means that these obligations extend to non-resident employers, not just Canadian employers. So there is no geographical distinction in the Income Tax Act that alleviates non-resident employers while bringing people to work up here in Canada. And we will learn about waivers and whatnot, and nuances, as we move forward. But the message here is that these obligations extend to non-resident employers. And similar legislation exists for CPP and EI.

Let's briefly look at CPP and EI. So, generally, employment has to take place in Canada to be pensionable or insurable under the Canada Pension Plan or Employment Insurance Act, so the CPP and the EI legislation give a different treatment whether the employment is inside or outside Canada. We will look at both in the next few slides.

But first let's have a look at social security agreements with respect to CPP. So, Canada has social security agreements with many countries. These agreements allow for employment outside Canada to be pensionable when certain conditions are met. They are intended to eliminate cases where a worker may have to contribute to CPP and to the social security regime of another country for the same work. So, we want to avoid double coverage there, similar to the reason for income tax treaties, or one of the reasons for income tax treaties. They also guarantee that a worker's CPP coverage is properly maintained while they are seconded to another country. So, a very important agreement. And you can find them linked on the CRA Web site which will take you to the HRSDC Web site, or the Human Resources and Skills Development Canada Web site, that have the agreements. So, let's look first at CPP legislation for residents employed outside Canada. So, if there's no social security agreement between Canada and the other country, the employment is pensionable if it meets certain conditions set out under the CPP regulations. But if it does not meet these conditions, the employer can still elect that this employment be pensionable. The employer would complete a CPT8 form to agree to cover under CPP all eligible employees and a type of employment in a particular foreign country. Now the CPT8 has to be done for each separate country, so just make a note of that. Now, where there is a social security agreement, employment is deemed to be pensionable employment. Now, take for example the case where an employee is seconded to another country by an employer operating in Canada and the Canadian company retains the employee on their payroll. The employer must then continue to withhold and deduct and remit employee CPP contributions like they would for a Canadian resident employee. So, fairly straightforward and it is mandatory.

Slide 16. Again, we're still looking at cases of residents employed outside Canada. So, the EI legislation states that in order for employment outside Canada to be insurable, it must meet all of these conditions: so the employee ordinarily resides in Canada, the employment takes place out of Canada or partly out of Canada for an employer who is a resident or has a place of business in Canada, and the employment would be insurable if it were in Canada, sort of a comparison factor there, and the employment is non-insurable under the laws of the country in which it takes place.

Now we'll look at situations where a non-resident is coming to work in Canada. So paragraph 6(1)(a) of the Canada Pension Plan Act states that pensionable employment is employment in Canada, providing that: the non-resident has the right to work here in Canada, that he is in an employment status with his employer, so we looked at that earlier on, there has to be an employer/employee relationship for CPP to exist here, and the employment is not excluded employment. This means that the employer would have to deduct CPP on the non-resident employee's remuneration in the same way that they would for their Canadian resident employee, unless they come from a country where a social security agreement exists, has been signed with Canada. So if an agreement exists, the employer does not have to withhold or deduct CPP contributions when and only when the non-resident employee provides the employer with a certificate of coverage issued by the foreign government. So, it's very important to receive this certificate prior to not deducting CPP.

What about EI when a non-resident is working in Canada? So, paragraph 5 (1)(a) of the Employment Insurance Act states that insurable employment is employment in Canada, so providing that: the non-resident, again, is authorized to work here, same as CPP, is in an employment status with the employer, same with CPP, so there has to be an employer/employee relationship. This would mean the employment is insurable unless, of course, it is non-insurable by some other provision. For example, if someone has taken a vow of poverty, perhaps. This means that the employer would deduct EI premiums on the non-resident's remuneration in the same way that they would do for a resident employee, so similar rules. Now where there's any doubt about CPP and EI issues, I strongly encourage you to visit the landing page of the CRA site. The top right has a link to CPP/ EI Explained and has a myriad of information, lots of articles on this, as well as contact our CPP/ EI rulings area for any questions. Now, here we've inserted a handy reference chart that we've reproduced from one of our employer guides, the Employer's Guide on Payroll Deductions and Remittances, or the T4001 and we've shown it here because it's a good, quick reference tool for employers to determine at a glance which tax tables they should be using in determining the withholding taxes applicable to their employee, all dependent on the situation. For example, we see that a non-resident that reports to an employer's place of employment in Canada, the employer should use the tables for the province or territory where the employment duties are performed.

Now, let's move on to the concept of tax waivers, which can reduce or eliminate the withholding tax applicable to the employee. Now, employees resident in countries having a tax treaty with Canada that will exempt an employee's income from tax in Canada can apply for a waiver of withholding by completing and filing Form R102-R, which is Regulation 102 Waiver Application, with the Canada Revenue Agency. A completed and signed Form R102-R should be submitted, or must be submitted, 30 days before either the start of the employment services in Canada or the initial payment for the employment services. Now, we'll make every effort to process a properly completed R102-R in situations where they are received less than 30 days prior to the date that the employment services begin or the payment. The effective date, however, on the waiver will be the date that the waiver application is approved. However, if you're a resident of the United States and are expected to earn no more than $10,000 Canadian, or another country that has a tax treaty with Canada and are expected to earn no more than $5,000 Canadian, you and your employer may be eligible to apply for a Joint Employer/Employee Reg. 102 Waiver on withholding using Form R102-J, Regulation 102 Waiver Application – Joint Employer/Employee instead.

Now, the Form R102-J is used when an employee will be exempt from tax in Canada under a tax treaty and it is not practical to apply for the R102-R waiver or the required individual tax number or social insurance number before the start of services, due to the nature of the services being performed. For example, what if you need servicing of equipment, last-minute, or services for which the dates and names of employees coming to Canada can't be determined until the last minute? So, it's in these situations that we can issue a R102-J waiver with a date that is effective before the date of application. And it can be retroactive up to 60 days prior to a completed waiver.

I will continue with waivers on slide 21 and introduce a new admin policy. So, a new administrative policy has recently been introduced to alleviate some of the burden non-resident employers face when sending employees to Canada to participate in a conference. So, on an administrative basis, when a non-resident employer sends their non-resident employee to attend a conference in Canada and the employee will be present in Canada for 10 days or less, very important detail there, including the travel time in Canada, and will earn less than similar to the other waivers, $10,000 in the year from employment services in Canada, if they are a resident of the U.S., including the amount earned during the period of the conference, or $5,000 in the year from employment services in Canada if they are a resident of another country that Canada has a tax treaty with, again including the amount earned during the conference, the employee will not be required to obtain a waiver of withholding tax. Now, it is important to note that when the employee is working in Canada before or after, directly before or after the conference, only the days, up to a maximum of 10, spent at the conference will fall under the above exception. So it's a very specific nuance and I invite you to look at the details on our Web site, as there is a definition of what we consider what a conference is, etc. So have a look at the nuances on the site, but it is an administrative measure to alleviate some burden.

With regards to reporting, noted on the slide, the obligation to withhold and report is waived in the specific circumstance except as noted on the slide, so if you've withheld tax, we need that on a slip, or if the employee has worked before or after the conference, that needs to be reported as well, including the amounts during the conference.

Now, another situation that may impact on your payroll business are secondments. Many workers are sent by their employers to work for specific periods of time in different countries. Now, this includes foreign workers that are sent to Canada by their employers to work on a detachment. Now, a detachment occurs when an employee is temporarily assigned, posted, or seconded to another country for a specific period of time. A worker is not considered detached if he or she has been permanently transferred or appointed to a position in another country. That's fairly self-evident. The withholding, remitting, and reporting responsibilities generally remain with the employer who retains the employee on its payroll. For example, a resident of Canada is sent on secondment to the U.S. If the Canadian company pays his salary, it is responsible for withholding, remitting, and reporting the remuneration in Canada; or if a non-resident comes to work in Canada on secondment, whether it is a non-resident employer or Canadian employer, either one would be responsible for withholding, remitting, and reporting the usual deductions.

Slide 24. So, the employer is responsible for remitting deductions along with the employer's share of CPP contributions and EI premiums and for reporting the deductions on a T4 slip. And, recall, these obligations extend to non-residents of Canada employing either resident or non-resident employees for services performed in Canada.

Now we'll have a look at payments outside the realm of employment income and briefly wade into payments for services performed in Canada rendered by a non-resident. So, under paragraph 153(1)(g), again back to the Income Tax Act, it says that any person paying at any time in a year fees, commissions, or other amounts for services must deduct or withhold from the payment the amount determined in accordance with prescribed rules and remit it to the Receiver General.

Now, the prescribed rules in this case is Regulation 105, which levies, as you can see on the slide, a 15% withholding tax, and that's a flat-rate tax, it's not too complicated to calculate. As noted in subsection 105(2) of the Regulations, this withholding obligation does not apply to remuneration from employment, described under 100(1) of the Regulations. So it's a very separate tax.

As a result, Reg 105 will apply in cases where the recipient of the payment is in a self-employed situation. Now, the recipients do not necessarily have to be individuals that perform the services. They may be corporations or partnerships.

Now, here is a following list of some activities to which Regulation 105 deductions may be applicable. Now, this list isn't meant to be exhaustive, it's just simply a highlight of some activities that can be subject to the 15% tax. For example, payments to non-resident artists and athletes for services provided in Canada, such as appearance and endorsement fees, are subject to this 15% withholding.

Now, many more examples and possible scenarios are detailed in our information circular 75-6R2. Now, if you are jotting down any information right now, maybe jot down this one: 75-6R2 is a great circular and source of guidance and information for those making payments to self-employed persons, as well as remuneration from employment to non-residents. Again, it will be listed in the back of the sideshow, though.

Amounts withheld under Regulation 105 must be remitted to the Receiver General no later than the 15th of the following month from when the payment is made. For example, if you pay someone for a service, an athlete or a star to come up and provide a service, and pay them in January, the tax is due February 15. The tax would then be remitted into a separate payroll account, under your principal business number account. So it would be separated from the normal remuneration or salary tax remitting account.

Now, whether or not a waiver or reduction of withholding was issued to the non-resident, a T4A-NR, NR standing for non-resident, information return must be filed with the CRA by the last day of February in the year following the year from when the payments were made. So again we go through a calendar, if someone comes up in January 2013, performs a service, you withhold 15% by Feb 15th, you file your paperwork or your T4A-NR by Feb 2014. And you can also consult our guide RC4445. And again, these obligations apply to whether the payer is a resident or non-resident of Canada.

Slide 29, waivers again. So again, similarly to the waivers we discussed under employment income, it is possible for a non-resident to get a waiver or reduction of Regulation 105 withholding. The 15% withholding is not the final tax of the non-resident. We consider this withholding to be a payment on account of the non-resident's potential tax liability. And generally, non-residents have to file a return in Canada to calculate their final tax liability or to get a refund of any excess withholding amounts. So if a non-resident can show that the 15% withholding is more than their potential tax liability in Canada, either due to treaty protection or income and expenses, perhaps your expenses will eat up some of that profit, obviously, or that income earned, we may waive or reduce the withholding. Now, Canada does not relinquish its right to Regulation 105 withholding through income tax treaties, only through the waiver process and, for this reason, a waiver is required for a payer to apply the provision of a tax treaty. So, to reduce the withholding, you need to have a waiver. Non-residents who want to ask for a waiver or reduction of withholding have to file a waiver application form, R105, to the tax services office in the area where the services are to be provided. The non-resident or the non-resident’s authorized representative, including the payer, can make the application.

Here we have produced a small checklist for you. This isn't in a guide, or in a circular, or on the Web, so it is just included in this presentation, but we've designed a small checklist that you, as an employer, can run through to verify some of the fundamental elements we spoke of today to help you determine your obligations. Now, not all situations require an exhaustive analysis of facts, and I’m assuming employers generally know who, in terms of residency, they are dealing with. Same with employer/employee relationship and consultancy. For example, it is a good bet that if a U.S. company sends an employee up to Canada to work for a few months, they will continue to be a non-resident. Same goes for a Canadian company hiring a U.S. company to provide services up here in Canada. You are probably not doubting the service provider’s residency status, in other words, you are confident they remain and are a non-resident. But where there is any doubt or uncertainty, I would encourage you to go through the checklist, for any of these factors, and use the help available through the CRA to make the right decisions regarding your payroll obligations. It's very, very important.

Now we will look at some possible scenarios that you may encounter in the course of your business. These scenarios are meant to summarize what we have seen for employment and non-employment income. Note we are not discussing, again, in any of these examples, the possibility of foreign responsibilities. So in trans-border transactions, employers should verify and ensure that they are meeting their responsibilities both in Canada and in the other foreign jurisdiction.

Let's begin with scenario number one, slide 32. So here we have Canco, an abbreviation we use to describe Canadian corporation, quickly. So Canadian corporation Canco hires a non-resident employee to perform duties in Alberta. What are the obligations for the employer? Canco has to withhold income tax using the Alberta tables unless a waiver is obtained because we are dealing with a non-resident that may have an income tax waiver reducing the withholding. CPP contributions must be withheld, again unless a certificate of coverage is presented by the non-resident employee to show they're already covered in their home country. EI premiums must be withheld and Canco would report the income and deductions on a T4 slip.

33. Here we have, again, a non-resident employee, so Canco hires a non-resident employee to perform duties in Michigan. So, this scenario is similar to the previous one. But it brings a new element. What if the employee did not perform the duties of employment in Canada? Basically, since the employee is a non-resident of Canada, and they are not working in Canada, or performing duties in Canada, they are not taxable on that in Canada. As we saw earlier, that non-residents are taxable only on the income they earn within the borders. So, as a result, no income tax, no CPP, no EI in Canada, no T4 slip. However, again, I strongly recommend contacting the foreign jurisdiction to see what your obligations are, if any, over there.

In this scenario, we have a company established in the United States that sends an employee, resident of the United States, to perform duties in Alberta. Now, since foreign entities have the same responsibilities as Canadian entities when they have employees working in Canada, the U.S. company would be required to withhold tax based on the rates where the employment duties are performed, in this case, Alberta, again, unless a waiver is obtained by the employee reducing the withholding, that would be a Reg 102 Waiver, or a certificate of coverages, obtained by the employer to alleviate the pension deductions. As for EI, the employer would be required to withhold the premiums, again unless it fell under one of those specific circumstances I mentioned earlier. And of course, the employer would also be required to file a T4 slip in Canada for that non-resident employee.

35. In this example, we have USco sending a non-resident employee to perform duties in Alberta, but Canco reimburses USco the non-resident employee's salary. So, as we saw earlier, foreign entities have the same responsibilities as Canadian entities when they have employees working in Canada. So the U.S. company would be required to withhold tax based on the rates where the employment duties are performed, in this case, Alberta, again unless a waiver is obtained by the employee. CPP is also withheld unless, again, a certificate of coverage is presented, and EI would be also withheld unless it fell outside the provisions listed earlier. And again, the U.S. employer would be required to file a T4 slip for that non-resident employee.

Now let's have a look at a scenario involving a resident employee. So, a Canadian company hires an employee resident of Canada to perform duties of employment in the United States. This employee would not be reporting to a place of business in Canada, of the Canadian company. As such, the Canadian company would be required to withhold tax based on the province or territory from where the employer's business is located and from where it pays the employee's salary. Because Canada has a social security agreement with the U.S., CPP would be withheld if the employer operates in Canada or undertakes to pay the employee's and the employer's contributions. Now, if we were dealing with a country that had not signed a social security agreement, if you recall, we would have to determine whether the employment meets the conditions to become pensionable under the CPP regulations or, alternatively, where the employment is outside Canada and not considered to be pensionable employment, the employer can elect that this employment be pensionable by completing a Form CPT8, again, agreeing to cover under CPP all employees in a particular type of employment in a foreign country. EI would also be withheld if the employment meets certain criteria as well, as we saw earlier. And those are that the employment outside Canada remain insurable if the employee ordinarily resides here in Canada, the employer's resident has a place of business in Canada, that's the employer, it would be insurable if the employment were in Canada so we do that in comparison, and is not insurable under the laws in which it takes place.

Finally we've come to our last scenario. So, here we have an example of a Canadian company hiring a non-resident to perform services in Alberta. So, we are not talking about employment income here, we are talking about services rendered. So, there is no employer/employee relationship between Canco and the non-resident. What does the payer have to do? Well, as I said earlier, in the service relationship here, the Canadian company needs to withhold 15% (Regulation 105 Income Tax) from the payment made to that individual for the services provided in Canada. Again, these tax deductions will be remitted into a separate payroll account from the usual payroll deduction account. And, of course, the Canco would report these deductions on a T4ANR slip.

I'm going to click ahead here in the presentation a little bit. There's our Web site and our phone number for business enquiries, so do make note of that. What we've done in this presentation is we've made three pages at the back here of consolidated information regarding non-resident materials. We've broken it into different topics, the second bullet from the bottom, the 75-6R2, it's the second revision, we have employment taxation, CPP, and EI. So, very good consolidated amount of information here that you'll have available to you quite shortly. Thank you very, very much for joining us today. It's been my pleasure to be here, speaking to you about this topic. I hope you learned something and you do have some takeaways. That's important for us. This is our goal, to disseminate this information to the public and employers so I hope you enjoyed it.

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