If an employee (who remains a tax resident of Canada) performs services for a Canadian employer outside Canada, the Canadian employer may have to deduct income tax from that employee's remuneration. However, if the employee is entitled to a foreign tax credit in Canada for taxes paid in the foreign jurisdiction, then the employee can request a letter of authority.
A letter of authority gives the employer permission to reduce the amount of income tax to deduct from an employee's remuneration.
Employers can also seek advice from the CRA through the contact details on Employment outside Canada.
CPP will be payable if there is reciprocal agreement keeping the outbound expatriate within the Canadian social security system for CPP (see 6.1.2).
CPP coverage can be
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Web page updated on 17 Mar 2025 14:59