Canadian corporation gives the taxable benefit to non-resident shareholder. For this, does the corporation withhold the tax or just issue the T4 slip?

The non-resident shareholder lives in the U.K. If the corporation needs to withhold the tax, which rate will be correct, 25% or 10%?

Answer

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A non-resident receives a T4NR, not a T4. If you issue a T4 to the non-resident and that non-resident files a non-resident tax return, he will be subject to Part 13 taxes of 25%.



Stephen Nazar, CGA CPA
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Toronto, Ontario
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