Concept: Tax Withholding for Nonresident Workers and Retirees (CAN)

Effective 2019-01-01, Workday enables you to tax nonresident workers and retirees earning income amounts for these income codes or services performed in Canada:

Annuity payments.
Investment income.
Pension payments.
Pooled registered pension plan payments.
Registered retirement savings plan payments.
Retiring allowances.
Royalty payments.

Nonresident workers and retirees can apply for a lower tax rate based on tax treaties between their country and Canada.

The

Federal Income Tax Non-Resident (FIT-NR) [CAN]

deduction calculates federal income tax for eligible nonresident workers and retirees. Workday calculates federal taxes for nonresidents at 25% unless there's a tax treaty. Workday uses the information in effect as of the pay period end date. The deduction references:

The worker's country.
The Income Code that’s recorded on the Maintain Worker Tax Treaties task.

When calculating T4A tax within these deductions, Workday excludes workers or retirees whose province of employment is U.S. or Other:

Federal Income Tax (FIT T4A) [CAN]
Federal Income Tax (FIT2 T4A Intermediate Calculation Only for Withholding Order DE) [CAN]
Province Income Tax T4A (PIT T4A) [CAN]
Province Income Tax (PIT2 T4A Intermediate Calculation Only for Withholding Order DE) [CAN]

Workday delivers these nonresident income codes pay component groups (PCGs) you can associate to related earnings for year-end tax reporting:

Pay Component Group	Description
NR Tax Income Code - 29 - Refund of premiums	Amounts related to RRSP refund of premiums.
NR Tax Income Code - 35 - Research and development royalties	Amounts related to research and development royalties.
NR Tax Income Code - 36 - Retiring Allowance	Amounts representing retiring allowance earnings.
NR Tax Income Code - 37 - Retirement compensation arrangements	Amounts for retirement compensation arrangements.
NR Tax Income Code - 39 - Superannuation or pension benefits - Periodic payments	Amounts related to periodic superannuation or pension benefits payments.
NR Tax Income Code - 40 - Superannuation or pension benefits - Lump-sum payments	Amounts for superannuation or pension benefits.

Workday prevents you from selecting these PCGs with a nonresident income code PCG on a pay component:

Any other nonresident income code PCG
Bonus Earnings - Regular [CAN]
Income Taxable (Do Not Withhold Taxes) [CAN]
Income Taxable (Withhold Taxes) [CAN]
Lump Sum Taxable T4 [CAN]

You can configure these PCGs on an earning with another nonresident income code PCG:

Income Taxable T4A-RCA [CAN]
Lump Sum Taxable T4A [CAN]
Lump Sum Taxable T4A-RCA [CAN]
Pension Income T4A [CAN]

These reports include the

Federal Income Tax Non-Resident (FIT-NR)

amounts within the

1a - Canada Revenue Agency Non Resident Tax

pay component group:

Tax Remittance Summary
Tax Remittance Details

You can use these withholding elections web services to import and export nonresident federal tax elections:

Get Payroll CAN Worker Tax Treaty
Put Payroll CAN Worker Tax Treaties

The

Get Periodic Company CAN Tax Remittance Data

web service includes nonresident tax deductions with the NR Tax Account.