Does the CRA reprieve those who have to commute for work?
The answer on the Canadian Government's website is pretty clear:  Most employees cannot claim employment expenses. You cannot deduct the   cost of travel to and from work, or other expenses, such as most tools   and clothing. However, that is most likely related to a personal vehicle. There is a deduction related to Public Transportation:  You can claim cost of monthly public transit passes or passes of   longer duration such as an annual pass for travel within Canada on   public transit for 2016. The second sleeping residence is hard to justify as the individual is choosing to work in this town and this individual is choosing to spent the night there - it is not currently a work requirement.  As always, please consult a certified tax professional in your country for any final determinations on personal (and corporate) tax laws and filings.
For tax purposes, what matters is your province of residence at December 31st. Quebec Tax abatement therefore applies if you were living in Quebec, regardless of your employer, assuming you are an employee. As for effective tax, your question misses some data and does not quite make sense as effective tax is the result of dividing your total taxes paid after deductions and tax credits by your total income. As such, one cannot tell you your effective tax rate without knowing taxes paid after deductions and tax credits and total income. That was a quote from the article itself... There's a good link involved in that excerpt... Read it...  Job lock is a real thing... That's the only reason people remain at the large corporations that treat them just like a number and don't give a crap about them...  People work for large companies with fucked up schedules, commutes and often health detrimental duties... Yet they don't want to adventure to the unknown where there's a chance they will not get the same benefit package...  As anecdote, I live in Rural Washington state, a lot of Union people travel to Seattle for work...  This is a very long, and stressful commute, I-5, 16, and 405 are not fun... Some of them will spend upwards of five or six hours a day just on the road... when you ask them why... It's because of the pay and the benefit package... when you factor in the extra hours of driving, the pay really is not that huge of a difference, and the toll on your body that that kind of commute takes is horrific... But they wouldn't dare look at small companies Closer by that may not be able to offer them the pension, and health insurance plan that is mandated when working for Amazon, or building for JP Morgan...  So they just give in, become a number, and on paper, and empirically, it is a net gain... But the intangible effects on their psyche, happiness, are quite clear.... "There is actually a restriction on how high a wage they can pay you. There didn't use to be, but now it has to be reasonable for the work you are doing, so they can't pay you $100/hr while other people doing the same work get minimum wage. You might ask why on earth a parent would want to pay a child way more than they're worth? The salary is tax deductible to the company. Then the child pays their ""expenses"" - hockey fees and equipment, field trips, birthday presents for their friends and so on - out of the money the company paid them.  They also save for their post-secondary education. The rest of the family budget now has a little more room, and the parents can lower their own salaries if they have expensive children. This means more net money in the company and less total income tax paid by the family for the same total income. My concern is that if your parents don't know whether or not you must be paid minimum wage (you must, there's no family exemption) then they also don't know whether you should have EI deducted (probably not) and various other special cases like eligibility for summer student subsidies. The firm's accountant should be able to help with these things and the company should know all this. It's not the role of a 14 year old to ask the Internet how to run a business, the business owners should know it." You should ask a CPA or tax lawyer to what extent living in specific housing provided by the employer as a job requirement is exempt from taxation.  You might find a nice surprise.  Your tax professional can also help you to report the items properly if mis-reported. Much of this is in the article you cite in the question, but perhaps a look at some of the original sources is warranted and will show why some expert advice might be useful.  I would argue that an RA who is required to police and counsel undergrads in a college dorm in exchange for a room or a flat is closer to a worker with quarters on a ship or at an oil well than a full professor who receives a rental home in a neighborhood near the university as a benefit.  In the first case living at the provided premises is necessary to do the job, but in the second case it is merely a benefit of the job.   The IRS Publication 15-B guidance on employer provided housing  is not entirely clear, so you might want to get some additional advice: Lodging on Your Business Premises You can exclude the value of lodging   you furnish to an employee from the employee's wages if it meets the   following tests. It is furnished on your business premises. It is furnished for your convenience. The employee must accept it as a condition of employment. Different tests may apply to lodging furnished by educational   institutions. See section 119(d) of the Internal Revenue Code for   details. If you allow your employee to choose to receive additional pay instead   of lodging, then the lodging, if chosen, isn’t excluded. The exclusion   also doesn't apply to cash allowances for lodging. On your business premises.   For this exclusion, your business   premises is generally your employee's place of work. For example, if   you're a household employer, then lodging furnished in your home to a   household employee would be considered lodging furnished on your   business premises. For special rules that apply to lodging furnished   in a camp located in a foreign country, see section 119(c) of the   Internal Revenue Code and its regulations.  For your convenience.   Whether or not you furnish lodging for your convenience as an employer   depends on all the facts and circumstances. You furnish the lodging to   your employee for your convenience if you do this for a substantial   business reason other than to provide the employee with additional   pay. This is true even if a law or an employment contract provides   that the lodging is furnished as pay. However, a written statement   that the lodging is furnished for your convenience isn't sufficient. Condition of employment.   Lodging meets this test if you require your   employees to accept the lodging because they need to live on your   business premises to be able to properly perform their duties.   Examples include employees who must be available at all times and   employees who couldn't perform their required duties without being   furnished the lodging.   It doesn't matter whether you must furnish   the lodging as pay under the terms of an employment contract or a law   fixing the terms of employment. Example of qualifying lodging. You employ Sam at a construction project at a remote job site in   Alaska. Due to the inaccessibility of facilities for the employees who   are working at the job site to obtain lodging and the prevailing   weather conditions, you furnish lodging to your employees at the   construction site in order to carry on the construction project. You   require that your employees accept the lodging as a condition of their   employment. You may exclude the lodging that you provide from Sam's   wages. Additionally, since sufficient eating facilities aren’t   available near your place of employment, you may also exclude meals   you provide to Sam from his wages, as discussed under Meals on Your   Business Premises , later in this section. Example of nonqualifying lodging. A hospital gives Joan, an employee of the hospital, the choice of   living at the hospital free of charge or living elsewhere and   receiving a cash allowance in addition to her regular salary. If Joan   chooses to live at the hospital, the hospital can't exclude the value   of the lodging from her wages because she isn't required to live at   the hospital to properly perform the duties of her employment. One question would be how the conflict with IRC 119(d) is resolved for someone who must live in the dorm to watch over the dorm and its undergrads. Here's 26USC119(d) from LII: (d) Lodging furnished by certain educational institutions to employees (1) In general  In the case of an employee of an educational   institution, gross income shall not include the value of qualified   campus lodging furnished to such employee during the taxable year. (2)   Exception in cases of inadequate rent Paragraph (1) shall not apply to   the extent of the excess of— (A) the lesser of— (i) 5 percent of the   appraised value of the qualified campus lodging, or (ii) the average   of the rentals paid by individuals (other than employees or students   of the educational institution) during such calendar year for lodging   provided by the educational institution which is comparable to the   qualified campus lodging provided to the employee, over (B) the rent   paid by the employee for the qualified campus lodging during such   calendar year. The appraised value under subparagraph (A)(i) shall be   determined as of the close of the calendar year in which the taxable   year begins, or, in the case of a rental period not greater than 1   year, at any time during the calendar year in which such period   begins.  (3) Qualified campus lodging For purposes of this subsection,   the term “qualified campus lodging” means lodging to which subsection   (a) does not apply and which is— (A) located on, or in the proximity   of, a campus of the educational institution, and (B) furnished to the   employee, his spouse, and any of his dependents by or on behalf of   such institution for use as a residence.  (4) Educational institution, etc. For purposes of this subsection— (A) In generalThe term   “educational institution” means— (i) an institution described in   section 170(b)(1)(A)(ii) (or an entity organized under State law and   composed of public institutions so described), or (ii) an academic   health center. (B) Academic health centerFor purposes of subparagraph   (A), the term “academic health center” means an entity— (i) which is   described in section 170(b)(1)(A)(iii), (ii) which receives (during   the calendar year in which the taxable year of the taxpayer begins)   payments under subsection (d)(5)(B) or (h) of section 1886 of the   Social Security Act (relating to graduate medical education), and   (iii) which has as one of its principal purposes or functions the   providing and teaching of basic and clinical medical science and   research with the entity’s own faculty. Apparently Canadians have not been paying any tax on Uber rides, and will only begin to do so on July 1, 2017. Source: http://mobilesyrup.com/2017/03/22/uber-canada-gst-hst-budget-2017/ "I'd say that it's more like 75% to 80%.  Here's why:  the amount of time required to find a new job (should you lose your current one) is at an all time high (something like a year and a half if you factor in the ""discouraged workers"").  So, your emergency fund, if it is going to plan for truly disastrous scenarios such as job loss, needs to be able to handle monthly expenses for a year and a half.  I would also throw in a re-education component to that as well, because you're more than likely going to need to retrain (if for no other reason than to tell prospective employers that you voluntarily took some time off to go back to school, so they don't shit can your resume before they even let you interview)." "If you are a telecommuter and in good terms with your employer, then all you need is contact your employer and explain your situation. Ask them for a short letter that indicates: ""1. they require you to work from a privately rented office (or from a home office for those who prefer working from home), 2. this is one of the terms of your employment, and, 3. they will not reimburse you for this expense."" With this letter in your hand, you satisify both the ""convenience of employer"" test AND the deduction of the rent for your private office as a unreimbursed employee expense.  The IRS cannot expect your employer to open an office branch in your city just for your sake, nor can they expect you to commute to your employer's city for work, which is an impossiblity considering the distance. Additionally, the IRS cannot ""force"" telecommuters to work from home. The key is to get a letter from your employer. You'd be surprised how easily they are willing to write such letter for you." Public transportation is generally a lot slower and not a whole lot cheaper. By car, my commute to the Bronx would take me 20 minutes, but if I took train/bus/subway it would take 90 minutes. Now I'm working in Manhattan again and public transportation costs me over $300/month just to get to the city and back, and still takes over an hour.  And on top of all that, the IRS is cutting the 2012 limit of pre-tax income that can be allocated to public transportation commuting expenses from $225 to $125 per month. Interestingly, the limit of pre-tax income that can be used to pay for commuter parking is not being reduced. I guess the government wants us to stop using public transit? Here's an example (US, not Canada) that shows up to a 30% increase for first 6 months after a >30 day lapse, but the best data will come from actual quotes from insurers. If you can do without driving for 2 years it's almost certainly worth dropping coverage and a car for that duration and paying an increased insurance rate for a spell after the lapse. I'm not sure how it works in Canada, but when living with my parents they could not exclude me from their insurance once I was a licensed driver. The insurance company considered me to have access to all vehicles, so my presence increased insurance rates. If you live with your mother, you'll have to check with your insurer to see how that works. If the correction results in you owing them money, you typically just need to pay them the appropriate amount. I believe they charge back-dated interest on the amount if it was supposed to have been paid in the past, but if it's for this year's taxes then payment isn't due until the end of April and so interest would not apply. In some circumstances, they may apply fines or press charges for tax evasion, but only if they have reason to believe you intentionally/knowingly attempted to misrepresent your tax return in order to avoid paying taxes. You can challenge their decision to fine you, but you are considered guilty until proven innocent. Obviously that's the opposite for any criminal charges. The good news is, lots of people accidentally enter the wrong numbers and the CRA is aware of this and rarely takes action against them, other than making them pay what they owe. They have ways to look for suspicious behavior and differentiate that from innocent mistakes. So don't worry, you should be fine, not fined. "The decision whether this test is or is not met seems to be highly dependent on the specific situation of the employer and the employee.  I think that you won't find a lot of general references meeting your needs. There is such a thing as a ""private ruling letter,"" where individuals provide specific information about their situation and request the IRS to rule in advance on how the situation falls with respect to the tax law.  I don't know a lot about that process or what you need to do to qualify to get a private ruling.  I do know that anonymized versions of at least some of the rulings are published.  You might look for such rulings that are close to your situation. I did a quick search and found two that are somewhat related: As regards your situation, my (non-expert) understanding is that you will not pass in this case unless either (a) the employer specifies that you must live on the West Coast or you'll be fired, (b) the employer would refuse to provide space for you if you moved to Boston (or another company location), or (c) you can show that you could not possibly do your job out of Boston.  For (c), that might mean, for example, you need to make visits to client locations in SF on short-notice to meet business requirements.  If you are only physically needed in SF occasionally and with ""reasonable"" notice, I don't think you could make it under (c), although if the employer doesn't want to pay travel costs, then you might still make it under (a) in this case." Yes, you have to file a tax return in Canada.  Non residents that have earned employment income in Canada are required to file a Canadian personal income tax return. Usually, your employer will have deducted sufficient taxes from your pay-cheques, resulting in a tax refund upon filing your Canadian tax return. You will also receive a tax credit on your US tax return for taxes paid in Canada. I few years ago my company in the Washington DC area allowed employees to contribute their own pre-tax funds. The system at the time wasn't sophisticated enough to prevent what you are suggesting. The money each month was put on a special credit card that could only be used at certain types of locations. You could load it onto the Metro smart trip card, and use it for many months. Many people did this, even though the IRS says you shouldn't. But eventually the program for the federal employees changed, their employer provided funds were put directly onto their Smart Trip card. In fact there were two buckets on the card: one to pay for commuting, and the other to pay for parking. There was no way to transfer money between buckets. The first day of the new month all the excess funds were automatically removed from the card;and the new funds were put onto the card. If your employer has a similar program it may work the same way. HR will know. Yes. There are a number of reasons for this, most notably some form of tax credits transfer over from year to year IF you file your taxes, and the CRA will only pay you deductions if all your taxes have been filed. If you don't owe them anything you won't necessarily get in trouble, but don't expect to get any money back from them until you file! Also, while it's probably much too late for this, if you have a partner, you can transfer a certain amount of tax deductions to them, and save them some money. The site is here: http://www.cra-arc.gc.ca/formspubs/t1gnrl/llyrs-eng.html "There was a post on a Canadian subreddit a week or two ago about Canadian east coast fishermen (who go on employment insurance for half the year, every year) complaining about immigrants and poor people who get ""hand outs"" from the government."