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I'm looking into a contract in IT (specifically software development), and the work would be done out of my home in Canada for a company based in the UK.

My questions are:

  • Is this arrangement possible?
  • Would I charge any taxes, such as GST or VAT, to the UK company?
  • Does it matter what currency I'm paid in?
  • Can you recommend any tax experts based in Canada who may be able to assist? (I've only found Canada-US experts so far...)

Any other experiences or things to be aware of (e.g. hidden costs) are welcome.

Thank you for your input.

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I'm a Canadian and I've freelanced (in the advertising field) for a UK-based company. They had a Toronto office that I dealt with for the project and cheques were issued locally so that simplified things. And because this company had an office on the ground in Canada, yes, I had to charge HST. However, you do not charge GST/HST if the company has no Canadian presence. In that case you need to get the client to sign a form entitled something like "Satisfactory Evidence as Proof of Non-Residence and Non-Registration for GST/HST Purposes." (Google it for examples.) You get it signed and file it away in case CRA should ask for it. I prefer getting paid in Canadian dollars because I can deposit cheques at an ATM while foreign currency cheques require me to get in line. And I might be wrong but I believe that the exchange rate used by the bank includes a hidden fee. Also a lot of companies take 60+ days to pay and the way the CAD is trending who know how much you could lose if you're paid in pounds. I prefer wire transfers and request payment in CAD. But you may be dinged a few dollars for the privilege. I'm not sure you need a tax expert. Just report your income to CRA in CAD.

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