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Foreign worker IEC

Audrey Rogoka

Member
Sep 20, 2020
19
0
Hi

I recently activated my open work permit and trying to figure out what kind of contract will be the best for me. So far I don't have much knowledge about taxation in BC. My employer is open to eighter do payroll or for me to subcontract and than I would have to deal with taxes myself. Sorry if I'm confusing something. If you could direct me to some "how a contract should look like and how to do taxes" for dummies I would really appreciete it.

Thanks!
 
 

Copingwithlife

VIP Member
Jul 29, 2018
3,124
1,347
Earth
Hi

I recently activated my open work permit and trying to figure out what kind of contract will be the best for me. So far I don't have much knowledge about taxation in BC. My employer is open to eighter do payroll or for me to subcontract and than I would have to deal with taxes myself. Sorry if I'm confusing something. If you could direct me to some "how a contract should look like and how to do taxes" for dummies I would really appreciete it.

Thanks!
You’ll be classified as self employed
Here’s a guide for self employed taxes

https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4002.html
You fill in a T2125 along with your T1
Business & Professional Incone

if you’re income will be over $30k over four rolling calendar quarters you have to register AND collect GST

https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4022.html

You’ll be a non resident for gst purposes and registration

Fill in a RC 1
Follow instructions here
Note , it’s MANDATORY to register and collect the GST if income is over $30k/four rolling quarters
Not optional
You CANNOT be registered over the phone if your SIN starts with a 9

https://www.canada.ca/en/revenue-agency/corporate/contact-information/non-resident-gst-hst-enquiries.html

I don’t understand when you asked what type of contract would be best for me

if you’ll be an employee, receive a T4 , then the employer deducts the required taxes at source .
And you won’t have to register for a gst number .
If you’ll be self employed, you pay your taxes at filing time , but you may have to pay instalments dependant on how much taxes you owe .
This apples to both personal income tax and gst
 
Last edited:

Audrey Rogoka

Member
Sep 20, 2020
19
0
Thank you for your answer.

About type of contract I meant what would be better for me, self-employment or being an emploee. This will be my first job in Canada and I don't know yet how this all works.

Step by step guide would be very helpful, from the moment when you get your SIN. I already have that.

I don't want to make any mistakes or learn to late that I didn't know something.
 

scylla

VIP Member
Jun 8, 2010
84,548
16,481
Toronto
Category........
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Thank you for your answer.

About type of contract I meant what would be better for me, self-employment or being an emploee. This will be my first job in Canada and I don't know yet how this all works.

Step by step guide would be very helpful, from the moment when you get your SIN. I already have that.

I don't want to make any mistakes or learn to late that I didn't know something.
What is your end goal? Are you just wanting to work in Canada for a bit and then leave? Or is your aim to get permanent residency? If your aim is to get permanent residency, then you definitely want to go the employee route (not self-employed). Far more options to get PR if you are an employee.
 

Copingwithlife

VIP Member
Jul 29, 2018
3,124
1,347
Earth
Well if you’re employed, that is , you’re issued a T4 at the end of the year, then your worked hours are considered insurable . You’d pay EI deductions . If you get laid off, then you’d be eligible for EI (employment insurance). If you’re s
Thank you for your answer.

About type of contract I meant what would be better for me, self-employment or being an emploee. This will be my first job in Canada and I don't know yet how this all works.

Step by step guide would be very helpful, from the moment when you get your SIN. I already have that.

I don't want to make any mistakes or learn to late that I didn't know something.
If you need a determination on what is better for your situation, self employed or employed, you need to talk to an accountant.
As mentioned above , If the end goal is PR ,employed has more options than self employed in that area.
Also employed has a benefit connection , EI, mat leave etc that self employed can sign up for and pay .known as special benefits .
 
 

jclarke99

Hero Member
May 10, 2020
234
73
Hi

I recently activated my open work permit and trying to figure out what kind of contract will be the best for me. So far I don't have much knowledge about taxation in BC. My employer is open to eighter do payroll or for me to subcontract and than I would have to deal with taxes myself. Sorry if I'm confusing something. If you could direct me to some "how a contract should look like and how to do taxes" for dummies I would really appreciete it.

Thanks!
Is your employer a Canadian company or foreign (e.g., U.S.)?
 
 

jclarke99

Hero Member
May 10, 2020
234
73
This will be my first job. I don't know much about how it all works yet.
Understood. I recommend the payroll option. You'll essentially be an employee of the company with access to Human Resources and possibly some benefits. If you subcontract, then you're acting as your own company, with a need to make quarterly estimated tax payments, and possibly other complications.