A worker from another country who does not establish significant residential ties with Canada and who is in Canada for less than 183 days is a non-resident. A non-resident is subject to Canadian income tax only on income from Canadian sources.

A non-resident worker can claim non-refundable tax credits if 90% or more of the worker's income is from Canadian employment. That worker can claim in full any personal amounts that apply. These include the basic personal amount and, if applicable, the spouse or common-law partner amount or the amount for an eligible dependant.

If less than 90% of the non-resident worker's income is from Canadian employment, that worker cannot claim most non-refundable tax credits.

A seasonal worker is a deemed non-resident for Canadian income tax purposes if both of the following conditions are met:

• The worker is in Canada for more than 183 days in the year
• The worker is considered, under an income tax treaty Canada has with another country, to be a resident of that country and not of Canada

Canada has income tax treaties with the following countries that have workers participating in this program: Mexico, Barbados, Jamaica, and Trinidad and Tobago.

A worker from a non-treaty country who is in Canada for 183 days or more in a calendar year is a deemed resident. A deemed resident is subject to Canadian income tax on income from all sources both inside and outside Canada.

A deemed resident can claim in full all non-refundable tax credits that apply. These include the basic personal amount and, if applicable, the spouse or common-law partner amount or the amount for an eligible dependant.

There are three forms to help determine whether you should withhold tax and, if so, how much:

• federal Form TD1, Personal Tax Credits Return, which liaison officers should complete for all workers
• provincial or territorial Form TD1, which liaison officers should complete for most workers, as applicable
• an optional withholding waiver that liaison officers can complete in addition to the TD1 forms

In addition to withholding income tax, you are also responsible for deducting Canada Pension Plan contributions and employment insurance premiums.

In Quebec, you may have to deduct Quebec Pension Plan (QPP) contributions. For information on the QPP, get the Guide for Employers: Source Deductions and Contributions (TP-1015.G-V).

You have to deduct CPP contributions according to the instructions in Guide T4001, Employers' Guide – Payroll Deductions and Remittances.

You have to deduct EI premiums according to the instructions in Guide T4001, Employers' Guide – Payroll Deductions and Remittances.

All persons working in Canada have to fill out the federal Form TD1 and a provincial or territorial Form TD1, if applicable, and give them to their employers. The TD1 forms help you determine the amount of tax, if any, to deduct from a worker's earnings.

Separate worksheets (federal and provincial or territorial) are available to calculate partial claims for certain non-refundable tax credits.

Provincial or territorial TD1 forms

Each province or territory (except Quebec) has its own Form TD1. All seasonal agricultural workers who claim more than the basic personal amount should complete Form TD1 for the province or territory where they are employed.

Employment in Quebec

Workers who are employed in the province of Quebec have to complete a federal Form TD1, Personal Tax Credits Return. If applicable, they also have to fill out a provincial Form TP-1015.3-V, Source Deductions Return, which is available from Revenu Québec.

Claim codes

The total amount a worker claims will determine which claim code you will use. Claim codes are listed in each version of Guide T4032, Payroll Deductions Tables. In some cases, you will use one claim code for the federal Form TD1 and another claim code for the provincial form.

If a worker does not give you a completed provincial Form TD1, you should deduct provincial tax using claim code "0."

The payroll deductions tables help you calculate CPP contributions, EI premiums, and the amount of federal, provincial (except Quebec), and territorial income tax that must be deducted from amounts paid.

You can use any of the following versions of the payroll deductions tables:

• Payroll Deductions Tables (T4032) and Payroll Deductions Supplementary Tables (T4008) – You can use these tables to calculate payroll deductions for all provinces and territories
• You can use the Payroll Deductions Online Calculator to calculate payroll deductions
• Payroll Deductions Formulas for Computer Programs (T4127) – You may want to use these formulas instead of the printed tables to calculate the worker's payroll deductions. This publication contains the formulas to calculate CPP contributions, EI premiums, and federal, provincial (except Quebec), and territorial income tax

All the payroll deductions tables are available for each province and territory, and also for workers working beyond the limits of any province or outside Canada.

Failure to deduct

If you fail to deduct the required CPP contributions or EI premiums from the amounts you pay your employee, you are liable for these amounts even if you cannot recover the amounts from the employee. The CRA will assess you for both the employer's share and the employee's share of any contributions and premiums owing. The CRA will also assess a penalty and interest as described in the section Penalty for failure to deduct.

If you fail to deduct the required amount of income tax from the amounts you pay your employee, you may be assessed a penalty as described below. As soon as you realize you did not deduct the proper amount of income tax, you should let your employee know. Your employee can either pay the amount when they file their income tax and benefit return or ask you to deduct more income tax at source.

Penalty for failure to deduct

The CRA can assess a penalty of 10% of the amount of CPP, EI, and income tax you did not deduct.

If you are assessed this penalty more than once in a calendar year, the CRA will apply a 20% penalty to the second or later failures if they were made knowingly or under circumstances of gross negligence.

Failure to remit amounts deducted

When you deduct CPP contributions, EI premiums or income tax from the amounts you pay to your employee or any other individual, you have to remit them to the Receiver General for Canada. Also, you have to include your share of CPP contributions and EI premiums when you remit.

The CRA will assess you for both the employer's share and the employee's share of any CPP contributions and EI premiums that you deducted but did not remit. The CRA will also assess a penalty and interest as described in the section "Penalty for failure to remit and remitting late" below.

Penalty for failure to remit and remitting late

The CRA can assess a penalty when:

• you deduct the amounts, but do not remit them to the CRA
• you deduct the amounts, but send them to the CRA late

When a due date falls on a Saturday, Sunday, or public holiday recognized by the CRA, your payment is considered on time if the CRA receives it or if it is postmarked on or before the next business day.

The penalty is:

• 3% if the amount is one to three days late
• 5% if it is four or five days late
• 7% if it is six or seven days late
• 10% if it is more than seven days late or if no amount is remitted

Generally, the CRA will only apply this penalty to the part of the amount you failed to remit that is more than $500. However, the CRA will apply the penalty to the total amount if the failure was made knowingly or under circumstances of gross negligence.

In addition, if you are assessed this penalty more than once in a calendar year, the CRA will assess a 20% penalty on the second or later failures if they were made knowingly or under circumstances of gross negligence. If you send a payment to cover the balance due with your return, it will be considered late. Penalty and interest charges may apply.

Whether you file online or on a paper return, you can make your payment in several ways. For more information, go to My Payment or see T4001, Employer's Guide – Payroll Deductions and Remittances.

Interest

If you fail to pay an amount, the CRA may apply interest from the day your payment was due. The interest rate the CRA uses is determined every three months, based on prescribed interest rates. Interest is compounded daily. The CRA also applies interest to unpaid penalties. For the prescribed interest rates, go to Prescribed interest rates.

Cancel or waive penalties or interest

The CRA administers legislation, commonly called taxpayer relief provisions, that allows the CRA discretion to cancel or waive penalties or interest when taxpayers cannot meet their tax obligations due to circumstances beyond their control.

The CRA's discretion to grant relief is limited to any period that ended within 10 calendar years before the year in which a request is made.

For penalties, the CRA will consider your request only if it relates to a tax year or fiscal period ending in any of the 10 calendar years before the year in which you make your request. For example, your request made in 2024 must relate to a penalty for a tax year or fiscal period ending in 2014 or later.

For interest on a balance owing for any tax year or fiscal period, the CRA will consider only the amounts that accrued during the 10 calendar years before the year in which you make your request. For example, your request made in 2024 must relate to interest that accrued in 2014 or later.

To make a request, fill out Form RC4288, Request for Taxpayer Relief – Cancel or Waive Penalties and Interest. For more information about relief from penalties or interest and how to submit your request, go to Cancel or waive penalties or interest.

Non-refundable tax credits

The federal and provincial or territorial non-refundable tax credits are indexed according to federal and provincial or territorial legislation. See the chart listing the basic personal amount, the spouse or common-law partner amount, and the amount for an eligible dependant. You can also find these amounts on the TD1 forms.

In the home country, a designated government official should complete the TD1 forms on behalf of each worker, one federal form and one form for the province or territory where the worker will be employed.

The designated government official has to make sure that the worker meets certain criteria before certifying the TD1 forms with an official stamp. The official has to examine the documents provided by the worker to support claims for personal amounts on the TD1 forms and verify that the claims are correct (for example, a marriage certificate or other document to support a claim for the spouse or common-law partner amount or a birth certificate to support a claim for the amount for an eligible dependant).

The official also has to verify that:

• 90% or more of the worker's world income for the year will be included when determining taxable income in Canada
• the worker is from a non-treaty country and will be in Canada for 183 days or more in the year

If a worker does not meet these criteria, the designated government official should not certify the TD1 forms.

Personal amounts

Personal amounts are non-refundable tax credits that a worker may be able to claim on an income tax and benefit return and on the TD1 forms. Personal amounts include the basic personal amount, the spouse or common-law partner amount, and the amount for an eligible dependant. A worker cannot claim CPP/QPPcontributions and EI premiums on the TD1 forms because they are included in the payroll deductions calculations.

Spouse or common-law partner amount

A worker can claim this amount for a legally married spouse or a common-law partner. The worker must use the spouse or common-law partner's net world income to calculate the non-refundable tax credits available.

Amount for an eligible dependant

A worker who is single, divorced, widowed, or separated (and not living in a common-law relationship) can only claim the amount for the worker's child if the child meets all of the following conditions:

• is under 18 years old
• is living at any time during the year with the worker in a home the worker maintains
• is related to the worker by blood, marriage, or adoption

To claim the amount for an eligible dependant, the liaison officer has to complete Schedule 5, Amounts for Spouse or Common-law Partner and Dependants, and attach it to the worker's return. Schedule 5 can be found in the Income Tax Package for Non-residents and Deemed Residents of Canada.

What if the worker's earnings are less than the personal amounts

If you are a liaison officer, make sure that the total of the worker's eligible non-refundable tax credits is entered on "Total claim amount" line on all TD1 forms. The employer will use the amount on this line and the payroll deductions tables to determine the correct amount of tax to deduct, if any.

What if the worker's earnings are more than the personal amounts

If a worker's expected earnings are more than the personal amounts claimed on the TD1 forms, the liaison officer should make sure the employer deducts income tax from the start of that year. This way, the employer will not have to deduct excessive amounts of tax in the last few pay periods.

What if the worker's earnings are expected to be close to the personal amounts

The employer should keep track of the worker's income to know when the worker's earnings exceed the personal amounts claimed on the TD1s. As soon as the worker earns more than the personal amounts claimed, the employer has to deduct tax from the total employment income the worker earns (generally claim code "0").

Alternatively, the employer can deduct income tax from the start of that year. This way, the employer will not have to deduct excessive amounts of tax in the last few pay periods if the worker's earnings exceed the personal amounts claimed on the TD1s.

What if a worker arrives without TD1 forms or with forms that have not been certified

If a worker arrives without TD1 forms or if the worker's TD1 forms have not been certified with an official stamp, the employer must deduct income tax based on net claim code "0." However, this can result in excessive tax deductions if the worker qualifies to claim personal amounts. The liaison officer should verify the claim and submit revised and certified TD1 forms as soon as possible.

On receipt of the amended TD1 forms, the employer can begin to deduct tax according to the payroll deductions tables, based on the new total claim amounts shown on the TD1 forms. The CRA may be able to refund to the worker part or all of the excess income tax withheld by the employer. However, the CRA will refund this amount only after an income tax and benefit return has been filed on the worker's behalf.

What if both spouses or both common-law partners work in the Seasonal Agricultural Workers Program

If both spouses or both common-law partners work in the Seasonal Agricultural Workers Program, the liaison officer should attach a note to each of their TD1 forms. If both spouses or both common-law partners are employed, the full spouse or common-law partner amount can be claimed only if the net world income of one of them is less than the spousal net income threshold (see the chart). A partial claim may be allowed if the net world income of one of them is more than the spousal net income threshold but less than the spouse or common-law partner amount.

More about TD1 forms

• If you hire a worker without certified TD1 forms, you should contact the worker's liaison officer to make sure that certified forms will be submitted as soon as possible
• You should not accept TD1 forms that have been physically altered. If you receive an altered Form TD1, you should ask the liaison officer to complete and submit a new form for the worker
• As long as the foreign designated government official has certified the original TD1 forms, additional forms do not have to be certified for the same worker unless the worker's personal amounts change
• The liaison officer has to give you copies of the original TD1 forms and any revised TD1 forms. The TD1 forms must be kept for future reference and copies must be included with the worker's income tax and benefit return

• You have to keep a copy of the original forms and a copy of the revised versions you receive to support the payroll deductions and income tax withheld

You have to file a T4 information return to the CRA by the last day of February following the calendar year to which the information return applies. If the last day of February is a Saturday or Sunday, the information return is due the next business day.

The CRA considers the return to be filed on time if they receive it or if it is postmarked on or before the due date.

The minimum penalty for late filing and failing to file the T4 information return is $100 and the maximum penalty is $7,500.

Mandatory electronic filing of T4 returns

For information about mandatory electronic filing, see RC4120, Employers’ Guide – Filing the T4 Slip and Summary.

Box 29 – Employment code

Enter code "15" in box 29 of the T4 slips prepared for the seasonal agricultural workers you employ.

For more information, see RC4120, Employers' Guide – Filing the T4 Slip and Summary.

Distributing T4 slips

You must give workers their T4 slips on or before the last day of February following the calendar year to which the slips apply. If you do not, you may be subject to a penalty.

The penalty for failing to distribute T4 slips to recipients is $25 per day for each such failure with a minimum penalty of $100 and a maximum of $2,500.

For more information, on how to distribute your T4 slips, go to Distribute the slips.

Non-refundable tax credits for 2024

Liaison officers should request a waiver on behalf of a worker only if it will benefit that worker. Otherwise, the additional paperwork can create confusion and possible errors in the withholding of tax.

Generally, if the personal amounts claimed on a Form TD1 are higher than any amount claimed on a waiver, it will not benefit that worker. A waiver should not be requested in this situation.

Two additional situations when a waiver will not benefit a worker are as follows:

• If a worker from Trinidad and Tobago expects to be in Canada for more than 182 days in the year, the provision of the tax treaty allowing the specified amount of exempt income does not apply. In this case, the liaison officer should not request a waiver for the worker
• If a worker expects to earn more than the treaty-exempt amount, the liaison officer should not request a waiver since the full amount of income will be subject to tax. Liaison officers for workers from Jamaica will usually not request waivers since the income earned by a worker will usually be more than the exempt amount. In most cases, it would be more beneficial for the worker to claim personal amounts

A waiver will benefit a worker from Mexico if:

• the worker is single, without dependants and earns more than the personal amount of $15,705 but less than $16,000
• the worker does not meet the 90% rule and earns less than $16,000

A waiver will benefit a worker from Barbados if the worker does not meet the 90% rule and earns less than $10,000.

A waiver will benefit a worker from Trinidad and Tobago if the worker does not meet the 90% rule and earns less than $8,500.

Waivers will also benefit workers from Jamaica who do not meet the 90% rule and earn less than $5,000.

If a waiver will benefit the worker, the liaison officer should provide it to you at the beginning of employment. The liaison officer should also provide you with completed and certified TD1 forms.

You should keep track of the worker's income to know when the waiver no longer applies. As soon as the worker earns more than the treaty-exempt amount, you have to deduct tax from the total employment income the worker earns (claim code "0").

In some situations, a worker may be transferred from one employer to another. To make sure the transition is smooth, the previous employer, the new employer, and the liaison officer have certain responsibilities.

When a worker is transferred to another employer, the liaison officer should:

• Make sure that copies of the original TD1 forms accompany the worker
• Inform the new employer of the worker's earnings to date. The liaison officer or previous employer has to provide a statement of the worker's earnings up to the date of transfer to ensure the new employer will withhold the required amount of income tax
• Follow the procedures set out on this page when providing revised TD1 forms
• Obtain a new waiver for a worker who is taking advantage of a tax treaty and give the new employer the new waiver that shows the amount of earnings limit still available under the applicable tax treaty. The amount still available is the treaty-exempt amount minus the worker's earnings up to the date of the transfer

When a worker is transferred to another employer, the new employer is responsible for all of the following:

• Determining the amount of tax to withhold based on the total claim amount on the TD1 forms that accompany the worker
• Making sure that the liaison officer or previous employer provided a statement of the worker's earnings up to the date of the transfer so that the new employer can withhold the required amount of income tax
• Getting a new waiver, if applicable. The new waiver will show the amount of earnings limit still available under the tax treaty. The amount still available is the treaty-exempt amount minus the worker's earnings up to the transfer date

If the TD1 forms show personal amounts higher than the income limit on the waiver, the new employer does not have to withhold income tax until the worker's earnings are more than the personal amounts.

If a Form TD1 has been revised, the new employer is only responsible for withholding tax based on the total claim amount on the revised Form TD1.

An income tax and benefit return must be filed on behalf of a foreign seasonal agricultural worker if one of the following applies:

• The worker is requesting a refund of income tax, CPP contributions overpayment, or EI premiums overpayment
• The worker has to pay income tax for the year in which the employment income was earned
• The CRA sends the worker a request to file an income tax and benefit return

There are other reasons why a worker has to file an income tax and benefit return. For more information, see the Federal Income Tax and Benefit Guide.

An income tax and benefit return should be filed on behalf of all foreign seasonal agricultural workers for the following reasons:

• to ensure workers receive a refund of any excess tax withheld or overpayment of CPP contributions
• to allow workers to claim applicable deductions or exemptions to reduce their tax
• to allow CRA to update the workers' CPP contributions for future pension benefits
• to confirm the amounts claimed on the TD1s

A liaison officer may file the income tax and benefit return on behalf of a foreign seasonal agricultural worker.

Alternatively, a worker can choose to have someone other than a liaison officer file a return on the worker's behalf. For more information, go to Representative authorization.

Workers from countries with which Canada has a tax-treaty should file an Income Tax and Benefit Return for the province or territory where they were employed.

Workers from countries that do not have a tax-treaty who were in Canada for less than 183 days are considered non-residents and should file an Income Tax and Benefit Return for the province or territory where they were employed.

Workers from a country that does not have a tax-treaty and who were in Canada for 183 days or more are considered deemed residents. These workers should file an Income Tax and Benefit Return for Non-Residents and Deemed Residents of Canada to report their world income. Their return must include a note giving the dates they entered and left Canada.

In certain situations, a worker may be subject to taxation in two or more jurisdictions (e.g. :employed in more than one province in the same tax year). Form T2203, Provincial and Territorial Taxes for Multiple Jurisdictions must be completed and included with the worker's income tax and benefit return. This will ensure that their income, non-refundable tax credits and tax payable are allocated correctly to the appropriate tax jurisdiction.

Two situations where Form T2203 is required are as follows:

• The worker receives employment income from more than one province in the same tax year. The provincial tax rates and non-refundable tax credits for each province will be used to calculate the tax payable for that province, using Form T2203
• The worker receives employment income from a province and also receives CPP (or certain other Canadian source pension type income) in the same tax year. The worker can elect under section 217 of the Income Tax Act to include the CPP income on their income tax and benefit return. The CPP income will be subject to federal tax and non-resident surtax. The employment income will be subject to federal and provincial tax. The federal and provincial tax rates and non-refundable tax credits (NRTC) will be used to calculate the tax payable for each jurisdiction, using Form T2203

A worker can usually claim an income tax refund within three years of the due date of the original income tax and benefit return. In some situations, this time limit may be extended. For more details, contact your tax services office.

To refund a CPP contribution overpayment, the CRA has to receive the request for refund within four years of the end of the tax year.

To refund an EI premium overpayment, the CRA has to receive the request for refund within three years of the end of the tax year.

Residence information – page 1:

On the first line, enter the province or territory where the worker earned employment income in Canada. If the worker is from a non-treaty country and is in Canada for more than 182 days, enter "Other" on the first line.

On the second line, enter the name of the country where the worker normally resides.

Do not enter the date of entry or departure.

Where to mail the paper return

If the worker's address is in:

• Denmark, France, the Netherlands, the United Kingdom, or the United States, send the return to the following address:

T1 Processing Division
Winnipeg Tax Centre
PO Box 14001, Station Main
Winnipeg MB R3C 3M3

• any other country, send the return to the following address:

T1 Processing Division
Sudbury Tax Centre
1050 Notre Dame Avenue
Sudbury ON P3A 5C2

Be sure to write "seasonal agricultural worker" at the top of page 1 of each return. Also, if the worker is electing under section 217, write "Section 217" at the top of page 1.

The following schedules and forms must be attached to each return:

• Form T1248 (Schedule D), Information About Your Residency Status
• Income Tax and Benefit Return, to claim federal non-refundable tax credits
• provincial or territorial Form 428 to claim provincial or territorial non-refundable tax credits and to calculate your provincial tax (except for deemed residents and workers employed in Quebec)
• copies of the certified federal and provincial or territorial TD1 forms and any tax waivers
• T4 slips
• Schedule A, Statement of World Income (Form 5013-SA)
• Schedule 5, Amounts for Spouse or Common-Law Partner and Dependants (only if the worker is claiming the eligible dependant amount)
• Form T2203, Provincial and Territorial Taxes for Multiple Jurisdictions, only if filing a multiple jurisdictions return when a worker, in the same tax year, has:
  • received employment income from more than one province
  • received employment and CPP (or similar Canadian source pension) income and elects under section 217 for pension income
• Schedule C, Electing Under Section 217 of the Income Tax Act, only if filing a multiple jurisdictions return and electing under section 217 for CPP or similar Canadian source pension income

To qualify for the GST/HST credit, the workers must be considered deemed residents of Canada in both the previous year and the current year. An income tax and benefit return must be filed for the workers for each year.

Deemed residents of Canada may also be entitled to claim the GST/HST credit for their spouse or common-law partner and children. For more information, go to GST/HST credit or see Guide RC4210, GST/HST Credit and Canada Carbon Rebate.