Province of Employment – BC Corporation Working in Nunavut

Accounting and Bookkeeping
1

I have a client who incorporated in BC to provide construction/framing services to an unrelated mining company in Nunavut. He’s the sole shareholder and wants to put himself on payroll.

A few details:

  • His corporation is registered at his home address in BC.

  • Invoicing, contracts, banking, payroll and business administration are all handled from BC.

  • He physically performs over 90% of his construction work at the mining company’s site in Nunavut.

  • The mining company is simply his customer, and his corporation has no known office or dedicated workspace in Nunavut.

I’m unsure whether his BC home qualifies as an employer establishment and whether the construction site could potentially be considered a deemed establishment.

Would you agree that BC should be his POE for payroll deductions and T4 Box 10, or should Nunavut apply?

2

His company is registered in BC so BC is the province of his employment.

3

…unless he sets up an “office” in Nunavut - for example, one room in his domicile in Nunavut could be considered a “home office” and the place where the employees normally “report to work”. But if he never does any office work there, it might be difficult to prove…

I’d be more concerned about CRA deeming it a PSB - they’ve been cracking down on PSBs in the last couple years.

4

That was also a bigger concern for me. I advise those types of clients to try to get more clients. Being designated as a PSB would create major expenses.

5

Thank you for the advice and suggestions