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Legally work in Canada with Work Permit and do business in UK

Legally work in Canada with Work Permit and do business in UK

Old Jan 5th 2024, 4:58 am
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Default Legally work in Canada with Work Permit and do business in UK

Quick post here about this as this was a big dilemma that I had over years about how I could make this happen!!

YES! YES! YES! it is possible to legally work in Canada on a work permit, and run a business at the same time!

I spoke with HMRC & Companies House in the UK before leaving the UK about this and they gave me the required advise necessary to make it happen and for it to be legal for both countries.
I legally registered a new business in the UK prior to leaving. I haven't started trading yet due to settling activities in Canada etc.
The business income is going to the UK and taxed by HMRC.
If Canada CRA (tax people) query it, HMRC said to tell them that UK is taxing me and to complete an official Form (can't remember name of Form at this moment) to that effect.

Again, I'd like to encourage anyone wanting to work/live in Canada and set up business simultaneously, to check out feasibilities and legalities with the relevant agencies in Canada/UK to get the correct information.
You can make anonymous queries if that helps.

All the best :-)
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Old Jan 5th 2024, 12:05 pm
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Default Re: Legally work in Canada with Work Permit and do business in UK

Yes of course, you can run businesses from 20 other countries if you want. And yes, Corporation Tax/VAT/employers taxes/etc (if applicable) you’ll pay in the UK - it’s only your personal income from the business that will be taxed in Canada as that’s where you’ll be working & tax resident. Tons of people run Ltd companies in the UK from another country (myself included - I have several UK companies) so I’m not really sure why you thought it wouldn’t be permitted. Most people just choose to set up their business in Canada for ease as that’s where they’ll be living/paying taxes, but there’s no rules about not having a business in another country.

The only thing to be aware of is that unless your work permit is an open one, you can’t work for anybody else in Canada other than the company named on your work permit, so you must make sure you don’t take on any Canadian clients.

Good luck with the new business.

Last edited by christmasoompa; Jan 5th 2024 at 2:00 pm.
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Old Jan 5th 2024, 5:56 pm
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Default Re: Legally work in Canada with Work Permit and do business in UK

I would be cautious about taking HMRC's advice about Canadian tax matters. They will tend to give advice that maximizes the UK's tax take. The OP should check the CRA's position on whether the OP's activities will be considered a permanent establishment of the business in Canada.
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