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8 Steps for Setting up an LLC in Canada Choose a Business Name. ... Form Your Company with a Registered Agent (RA) ... Create a Virtual Mailing Address. ... Get Your EIN. ... File Articles of Organization. ... Obtaining Necessary Licenses and Permits. ... Apply for a U.S. Bank Account. ... Stay on Top of Filing Taxes as an LLC.
As a resident corporation of Canada, LLCs are also required to report their income to the CRA. LLC income is taxed at the same corporate rate as Canadian corporations. This results in double taxation and cannot be rectified.
Although the LLC will be required to file a tax return in Canada since it is considered a corporation, it will be eligible to claim Treaty benefits attributed to its members in the U.S. under the new ?look-through? treatment in the Fifth Protocol.
Income Tax Filing requirement of a nonresident US LLC in Canada? Attach Schedule 97 to the T2 Corporation Income Tax return. ... Article 6 of the US-Canada Tax Convention may be applied to claim the benefits. ... File form NR 303 (NR 303 ? Declaration of Eligibility for Benefits under a tax treaty for a hybrid entity).
For tax purposes, LLCs are treated as corporations by the Canada Revenue Agency (CRA). To take advantage of the LLC's "pass-through" treatment under United States tax laws, Canadian taxpayers cannot take advantage of many intended tax efficiencies.