US Citizens Working in Canada
See what you actually take home after US and Canada taxes — whether you're already working abroad or planning a move.
Here's what matters most for US citizens working in Canada:
- •Canadian tax rates vary by province, making calculations complex
- •FEIE can exclude up to ~$126,500 from US taxation if you meet the physical presence test
- •US-Canada tax treaty is comprehensive and helps prevent double taxation
- •Provincial taxes add an additional layer beyond federal taxes
Who taxes you?
As a US citizen working in Canada, you're subject to taxation by both countries. The US taxes citizens on worldwide income, but the Foreign Earned Income Exclusion (FEIE) can exclude up to approximately $126,500 of foreign earned income if you meet the 330-day physical presence test. Canada taxes residents on Canadian-sourced income with both federal and provincial rates. The US-Canada tax treaty is one of the most comprehensive and provides foreign tax credits to prevent double taxation.
Common pitfalls
- Canadian tax rates vary significantly by province (Alberta vs Quebec, for example)
- Not meeting the 330-day physical presence test disqualifies you from FEIE
- Provincial tax rates can add 10-15% on top of federal rates
- State tax obligations may persist if you maintain US state residency
- Currency fluctuations between USD and CAD can impact your effective income
Coverage level
Partial coverage with general tax guidance. Calculations are approximate.
Frequently asked questions
Yes. US citizens must file US tax returns regardless of where they live. However, you may not owe US taxes if your income is below the FEIE threshold and you meet the physical presence test.
Canada has a progressive income tax system with both federal and provincial rates. Federal rates range from 15% to 33%, and provincial rates vary significantly. Combined rates can exceed 50% in high-tax provinces like Quebec or Nova Scotia.
Generally no. The US-Canada tax treaty is comprehensive and provides foreign tax credits to prevent double taxation. You'll typically pay the higher of the two tax rates, not both.
Each Canadian province has its own tax rates that apply in addition to federal taxes. Rates vary from around 10% in Alberta to over 15% in Quebec. Your total tax rate is the sum of federal and provincial rates.
Official resources
Primary sources:
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