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Employing in Canada

At a glance

Employment in Canada

Foreign companies that employ workers in Canada face several challenges and must adhere to the legal and regulatory framework that is in place. Most notably there are differences depending on the type local entity they have incorporated. In some cases, using an outsourced employer will make the process smoother, and it is recommended to use professional legal services as well. Our guide explains Canadian policies on leave, termination and payment of benefits.

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Payroll & Tax in Canada

Complying with local payroll and tax requirements is essential for a company doing business in Canada. Issues such as tax rates and withholding and social security are all essential in ensuring a seamless human resources operation. Many companies will consider outsourcing these administrative tasks to a GEO (Global Employment Organization) to avoid any problems with compliance.

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Immigration / Work Permits in Canada

Foreign workers are required to have the proper visas and work permits in Canada, as established by immigration laws. This often requires incorporation and licensing prior to sponsoring work permits for employees, which can be a problem if your company is trying to enter the country quickly. Using a GEO solution can speed up the process of obtaining work permits, using an existing local entity.

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Incorporation

There are several business structures available for incorporation in Canada, and each has advantages and disadvantages. In some cases it will depend upon the type of industry that you are in, and the scope of planned business activity, as some structures require a certain percentage of Canadian ownership. Our guide has a comparison of the time and cost for incorporating standard company structures including Corporation, Partnership and Extra Provincial Corporation.

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GEO Solutions or DIY Employment in Canada?

Companies entering Canada must make a decision whether to use their own resources for a Do-It-Yourself (DIY) approach, or to use a Global Employment Organization to handle payroll and employment responsibilities. A GEO or Canada Employer of Record solution makes it faster, easier and cheaper to deploy staff if they don’t have a Canadian entity established that can run payroll.

A DIY approach will typically be delayed until there is a properly incorporated company ready to run payroll and will include the cost of registered capital. The Shield GEO Solution is already properly incorporated in Canada, it has an active payroll and it is setup to sponsor work permits. This greatly reduces deployment times. Additionally Shield GEO is responsible for all compliance issues related to the employment.

Shield GEO

Shield GEO provides a fully outsourced employment service in Canada. Companies expanding into Canada can contract with Shield GEO to employ and payroll their staff on their behalf in Canada. Shield GEO then assumes the legal responsibility for these employees, becoming the Employer of Record, sponsoring them on work permits, complying with local employment law and running their monthly payroll.

Using Shield GEO Employer of Record Services in Canada

Payroll Canada
Management Fee for Employer of Record Services / Monthly Payroll Costs

Please contact us for a quote

Notes

Shield GEO pays the employee on a monthly basis, typically on the last working day of the month although we can adapt to your preferred schedule. Income tax and social security (where applicable) are deducted at source and paid to the local tax authorities.

 
Grossed income Tax Rate (%)
0 – 43,953 15%
43,953-87,907 22%
87,907 – 136,270 26%
136,270+ 29%
Tax Returns Supplied

Yes

Employers Social Security and statutory contributions

CPP (Canada Pension Plan) 4.95%. Maximum contributions of $2,479.95 per annum

Employment Insurance Max $1,302.84 p/a

Employees Social Security and statutory contributions

CPP (Canada Pension Plan) 4.95%. Maximum $2,479.95 p/a

Employment Insurance 1.88%. Max $930.60 p/a

Insurance requirements

Included in the Social Security but many Employers offer additional Medical Insurance.

Work Permits
Can Sponsor Work

Shield GEO is only able to sponsor Mexican and USA workers to work in Canada under the visa category ‘Professionals Under the North American Free Trade Agreement’, known as the TN Visa. The employee’s profession must be recognized under NAFTA (North Atlantic Free Trade Agreement) and be one of the 63 occupations that the HRSDC recognises as exempt from HRSDC employment authorisation.

Work Permit cost

USD $2000

Work Permit processing time

1-2 weeks

Work Permit process

The applicant needs to apply for the Work Permit before travelling to Canada at their local Canada Visa Office or if travelling from the US at a Canadian Port of Entry.

Documentation required: Passport, Job offer, employment contract, name of the Canadian Employer, Job Description, Copy of Professional Qualifications.

Can Work Permit be processed in country

No

Switch Business Visa to Work Permit?

No

Can Spouse work on dependent visa?

No

Business Visas
Can do Business Visa

Yes

Business Visa Cost

USD $500

Business Visa processing time

5-10 days Consultant Dependent

Others
Can supply private health care

Yes

Can assist opening bank accounts

Yes

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