Province of Employment Decision Tree

This decision tool helps determine the Province of Employment (POE) and the required payroll tax forms and deductions for Canadian-resident employees, including remote work scenarios.

Answer the following questions to determine the correct province of employment and applicable tax requirements and considerations.

Non-Resident Employee

This tool is intended solely for employers with Canadian resident employees. The tax obligations of non-resident employees shall be determined in accordance with applicable tax treaties and the relevant facts and circumstances of each individual case.

Does the employee physically report for work at the employer's permanent or deemed establishment?

For further details on permanent or deemed establishments, refer to the Guide Province of Employment Payroll Best Practices.

Yes

Was a full-time remote work arrangement made?

A full-time remote work arrangement exists between the employer and the employee when the agreement is either temporary or permanent. The employer directs or allows employees to perform their employment duties full-time remotely. The employment duties are to be performed at one or more locations that are not establishments of the employer.

Yes

Secondary Indicators

If there were no remote agreement, which of the following would require the employee to attend or be connected to a specific establishment? (Select all that apply.)

Would attend in-person meetings (through any method of communication scheduling/requirements)

Would receive work-related materials, assistance, or equipment

Would come in-person to receive instructions from the employer (through any method of communication)

Would be responsible for or supervise employees as indicated in their contract

Would report to an establishment based on the nature of the duties performed

Employee physically reports to a single establishment

The Province of Employment (POE) is where the employee physically reports for work at the employer's permanent or deemed establishment.

Select the province/territory where the employee reports:

Employee physically reports for work at multiple establishments

The Province of Employment (POE) is the location of the employer's establishment where the employee spent the most time. If the employee spent equal time at multiple establishments, use the establishment where the employee worked last.

If equal time was spent in Quebec and another province/territory, RQ would consider the entire pay period as having been worked in Quebec, even if Quebec was not the last location.

Select the determined province/territory:

Full-time remote, but would otherwise report to an establishment

The Province of Employment (POE) is where the employee would physically report to work if not for the full-time remote agreement and is reasonably attached to the employer's establishment.

Select the province/territory where the employee would report:

Does not report to an establishment

The Province of Employment (POE) is the province of the employer's establishment from which the employee is paid, or where revenue and expenses are incurred for T2 (Business/Corporate Income Tax Return) reporting.

Select the province/territory of the paying establishment:

Employer has no establishment in Canada

Employment is considered in Canada beyond the limits of any province or territory.

Tax Requirements:

Tax Form: TD1
Source Deductions: CPP, EI, Federal Income Tax
Workers' Compensation: Coverage requirements vary by province or territory and generally depend on where the employee physically performs their employment duties. Employer registration may be required, optional, or exempt.
Employment Standards Act: Province/territory where the employee physically performs employment duties
Tax slip: T4

Province of Employment:

Tax Requirements:

Tax Forms: TD1 and TD1 ()
Source Deductions: CPP, EI, Federal and Provincial Income Tax
Workers' Compensation: Coverage requirements vary by province or territory and generally depend on where the employee physically performs their employment duties. Employer registration may be required, optional, or exempt.
Employment Standards Act: Province/territory where the employee physically performs employment duties
Tax slip: T4
Payroll Tax: Employees who work in either the Northwest Territories and/or Nunavut may be subject to a 2% Payroll Tax, which the employer is responsible for deducting from their pay. For further details, refer to the Guide Province of Employment Payroll Best Practices.

Province of Employment: Quebec (QC)

Tax Requirements:

Tax Forms: TD1 and TP-1015.3
Source Deductions: QPP, EI, QPIP, Federal and Quebec Income Tax
Workers' Compensation: Coverage requirements vary by province or territory and generally depend on where the employee physically performs their employment duties. Employer registration may be required, optional, or exempt.
Employment Standards Act: Province/territory where the employee physically performs employment duties
Tax slip: T4 and RL-1
Provincial Health Tax: Quebec Health Service Fund (QHSF)
Payroll Tax: Employees who work in either the Northwest Territories and/or Nunavut may be subject to a 2% Payroll Tax, which the employer is responsible for deducting from their pay. For further details, refer to the Guide Province of Employment Payroll Best Practices.

Please send an email to Infoline@payroll.ca including your member number if you require further payroll compliance assistance with determining the province of employment.