Any person paying the actor or entertainer for performing in Canada will generally be required to withhold 15% of the payment and remit it to the Canada Revenue Agency on account of taxes.4 In the following year, the payer is required to issue form T4A-NR to the payee.
Many people mistakenly think that the withholding and remitting of the 15% Canadian tax is the end of the matter from a Canadian tax perspective. That is not correct! That tax withheld is just an amount remitted on account of tax-it is not the actual tax. The non-resident will be required to file a Canadian tax return to compute the actual tax payable, on the Canadian income, after deducting expenses applicable to that income. That actual tax could well be more than the 15% withheld, and, in that case, the non-resident will be required to remit the balance to the Canada Revenue Agency. Failure to file a return and pay tax on a timely basis could render the non-resident subject to penalties and interest. If the Canada Revenue Agency does not ultimately see a tax return filed that ties into the T4A-NR, they will normally send a demand to the non-resident to file a Canadian tax return.
There are special rules that apply to non-residents who earn income from acting in Canada in a film or video production. These rules can apply to non-resident corporations that earn income from the performance of a related non-resident.
1 2(3)(b) the Act-all subsequent statutory references are to the Act.
4 Regulation 105. For performances in the Province of Quebec, an additional 9% is required on account of Quebec taxes.