Part 1: U.S. LLC For Canadians Doing Business in the U.S. Good or Bad?

This topic is specifically for… 
Canadians who are looking to invest into the U.S.
Canadian businesses and corporations who want to set up in the U.S. 
A person who's starting a new business in the U.S. and is hearing LLC a lot.

#1 Problem with LLCs if You’re a Resident of Canada — Double Taxation

The number one problem that the Canadians will face when they own a U.S. LLC is double taxation. This is one of the biggest areas the tax relief does not work. It doesn't because the type of income that is being earned or generated on the U.S. side is classified differently on the Canadian side and the way the CRA looks at it.

#2 Problem with LLCs if You’re a Resident of Canada — Branch Profit Tax.

Because Canada will view your U.S. LLC as a Corporation, you may also fall under the Branch Profit Tax. So, if everything is being managed for the LLC from within Canada, then it falls under the Branch Profit Tax and the CRA will tax that income as well.

So, not only will you encounter double-taxation, you’ll also have to pay the Branch Profit Tax on top of that.

Get help planning for a cross-border move, operations, and taxes:

🇺🇸 Houston Office - (713) 451 - 9700
🇨🇦 Toronto Office - (416) 800 - 2709
📧 [email protected]

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Comment any questions or email us at [email protected] We will tackle those in future videos.