If your Canadian business has expanded into the U.S. market or has dealings with U.S. customers, it is important to consider the U.S. tax implications of having a U.S. market presence. Canadians — individuals or corporations — can end up with a U.S. tax liability if they carry on a trade or business in the U.S. Even if there is no U.S. tax liability associated with carrying on a trade or business, there may be U.S. filing requirements, which must be met on a timely basis. If these requirements are not met, significant penalties may apply. There have also been significant changes in the U.S. that impact Canadians doing business in the US — from the recently enacted Tax Cuts and Jobs Act to the U.S. Supreme Court decision on U.S. sales tax in the Wayfair case.
To learn more about U.S. federal income tax implications for Canadian businesses and filing requirements that can arise for Canadians doing business in the U.S., read our Tax Bulletin Tax Consequences for Canadians Doing Business in the U.S.
This tax tip is a publication of BDO Canada LLP on developments in the area of taxation. This material is general in nature and should not be relied upon to replace the requirement for specific professional advice. The information in this tax tip is current as of September 10, 2018.