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Is It Possible For A U.S. S-Corp To Avoid Paying Canadian And Provincial Taxes On Income From A Canadian Client (Consulting) And Instead Opt To Pay U.S. Corporate Taxes? Hypothetically, the consulting fees would total $7 mill. Or is there a way to offset the higher Canadian rate?
It depends on several factors:
- Where are the services performed? Canada or the US?
- If the services are performed in Canada, how many days are you or your
employees physically present in Canada?
- What are the total revenues of your company for the year?
- If the revenue from the Canadian contract is generated by a single person
performing services in Canada does the Canadian contract revenue exceed 50%
of the total company's revenue for the year?
Depending on your answers, your company may or may not have a Canadian tax liability.