Whether the client is a multinational corporation transferring an executive to or from Canada, or a Canadian resident business person, there is a considerable level of complexity involved in minimizing the individual’s tax burden, while at the same time decreasing the after-tax cost of properly compensating the people that most valuable to the continued prosperity and growth of the business.
Foreign executives and employees being transferred to Canada, and the companies that employ them, need to understand Canada’s tax rules. Both executive and employers need to appreciate how their existing foreign compensation structures will be taxed in Canada, and also how to re-structure compensation in a consistent manner that maximizes all of the opportunities available under Canada’s tax laws.
For Canadian employees moving abroad, there are a number of critical residency, pension and tax issues that need to be resolved to avoid difficulties such double taxation. In addition, Canadian employees moving abroad will need to plan for the impact of the deemed disposition of assets on their departure from Canada.
Lastly, the abovementioned structures and tax planning opportunities need to be understood in the broader context of the overall business strategy, which includes management transition and inter-generational transfers of wealth issues.
For further information on this specific area of practice, please contact our specialized and dedicated tax lawyers:
TaxChambers LLP is collaborating with Andersen Global® in Canada.