Immigration Laws and Regulations 28 February 2024

Employer and worker tax obligations under the Temporary Foreign Worker Program (TFWP)

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Employment and Social Development Canada (ESDC) wishes to remind employers and workers of the significant tax obligations they face under the Temporary Foreign Worker Program (TFWP). This reminder aims to ensure tax compliance for both employers and temporary foreign workers in Canada.

For employers: filing T4 information returns, distributing T4 slips and Relevé 1 slips (for positions in Quebec)

It is crucial that all employers file a T4 information return to the Canada Revenue Agency (CRA) and give workers their T4 slips. The deadline for doing so is set for the last day of February of the following calendar year, which is February 29, 2024, for this year.

Employers are encouraged to consult the RC4120 guide, “Employer’s Guide- Filing T4 Slips and Summary” for detailed information on this matter. Adhering to these requirements is critical, as financial penalties may be imposed by the CRA for non-compliance.

Employers required to provide a Relevé 1 slip, for workers whose positions are in Quebec, and encouraged to follow the instructions published by Revenu Québec on this topic, available on their website.

For seasonal agricultural workers

Seasonal agricultural workers from abroad should be aware that they may be subject to income tax in Canada. The CRA provides specific guidelines on tax withholding for these workers, including how to determine the amounts to withhold.

Employers of seasonal agricultural workers, as defined by the CRA, will need to enter code “15” in box 29 of the T4 slips.
Country-specific guidelines for workers participating in the seasonal agricultural worker program (SAWP)

Employers with workers from the SAWP stream must follow country-specific guidelines for distributing T4 slips, based on the worker’s country of origin. For Caribbean countries, a T4 slip (and Relevé 1 slip if applicable) must be provided to the country’s representative in Canada. For Mexico, the T4 slip (and Relevé 1 slip if applicable) must be handed directly to the worker and, if applicable, to the person designated by them.

This reminder from ESDC highlights the importance of tax obligations under the Temporary Foreign Worker Program (TFWP). It is crucial for both employers and workers to be aware of these obligations and act accordingly to ensure compliance.

For more information and to access necessary guides and forms, please visit the websites of the CRA and Revenu Québec.

Managing tax obligations arising from the Temporary Foreign Worker Program (TFWP) can sometimes be complex and beyond the internal capabilities and resources of some companies. By recognizing the importance of adhering to such obligations, employers facing these challenges have the option to turn to specialized international recruitment agencies.

These expert partners, with their deep knowledge of immigration and integration, offer personalized and effective support to help employers and their temporary foreign workers comply with, among other things, the tax requirements of federal and provincial governments.