The emergence of remote work in recent years has led to payroll
compliance questions for Canadian employers.
The Canada Revenue Agency (“CRA”) implemented a new
administrative policy effective January 1, 2024, which specifically
targeted employees engaged in full-time remote work in Canada. This
policy introduced a structured framework to determine the province
of employment (“POE”) for tax and deduction purposes,
particularly relevant for employers navigating the complexities of
remote work arrangements.
The Policy's Scope
The policy applies exclusively to employees operating under
full-time remote work agreements. These agreements encompass
situations where employees are directed or permitted by their
employer to work remotely 100% of the time. Notably, the policy
covers both temporary and permanent arrangements, offering clarity
for various employment contexts.
