Entities and individuals affected by recent international travel restrictions may find relief in new CRA guidance
Multinational entities and individuals affected by recent international travel restrictions may find relief in new CRA guidance to address cross-border tax issues caused by these restrictions. In its new guidance, the CRA clarifies that prolonged stays in Canada that solely result from travel restrictions will not necessarily affect the tax residency or permanent establishment of a non-resident entity. The CRA also clarifies that such travel restrictions may not affect the tax residency of a non-resident individual, or the ability of a cross-border employee to qualify for treaty benefits on employment income. In addition, the CRA provides administrative relief to reflect delays in its processing of certain withholding tax waiver requests and Section 116 Certificates, due to COVID-19.
The CRA clarifies that its guidance applies from March 16, 2020 to June 29, 2020. The CRA advises that, after this period, it will either extend the guidance or rescind it if it is no longer required.
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