This article is about Justworks EOR (Employer of Record). What product am I using?
This guide explains which TD1 tax forms you need to submit during onboarding with Justworks, why certain provincial forms are required, and how your taxes are assessed throughout the year. The goal is to help you understand how the Province of Employment affects payroll tax withholdings and what steps you can take to avoid unexpected year-end balances.
Which TD1 tax form do I need to submit?
Canadian employees are required to submit two tax forms upon onboarding:
- One federal TD1, and
- One provincial TD1
What forms are required by Justworks?
Justworks requires employees to submit the following forms:
Québec employees
- Federal TD1
- Québec TP-1015
All other employees
- Federal TD1
- TD1-BC (British Columbia), regardless of where they live
Note: These requirements are set by CRA rules tied to the Province of Employment.
Why do I submit a TD1-BC if I don’t live in British Columbia?
Employees must submit the TD1-BC because Justworks’ permanent establishment is in British Columbia, and payroll is processed from BC. Under Canada Revenue Agency (CRA) guidelines, provincial tax withholding must follow the Province of Employment, not the province where the employee resides.
This means:
- Employees outside Québec will have their provincial taxes withheld using BC tax rates
- Québec residents follow Québec’s separate withholding rules
More information on CRA guidelines
As of January 1, 2024, the CRA clarified how the Province of Employment is determined for remote workers who do not report to a physical establishment:
For Income Tax, CPP, and EI purposes, an employer’s establishment includes any place in Canada that the employer owns, leases, or rents where employees report to work or from which employees are paid.
How will my personal tax returns be calculated?
At the end of the year, when employees file their personal tax returns, taxes are assessed based on their Province of Residence.
Depending on the provincial rates where you live, you may:
- Receive a refund, or
- Owe additional income tax
Any over- or under-deductions are reconciled once the CRA assesses your return.
How can I make sure I don’t owe taxes at the end of the year?
Employees can use the federal TD1 to request additional tax deductions if they believe they may owe taxes.
You can also review information on how the Province of Employment is determined and compare provincial income tax rates.
Click here to read more about how the Province of Employment is determined, and compare provincial income tax rates here.
How do I submit the correct TD1 form on the Justworks platform?
The Justworks platform provides the required forms for you:
- Federal TD1
- TD1-BC
- TP-1015 (for Québec residents)
Important: Please only complete and upload the forms provided in the Justworks platform. Do not use TD1 forms from your Province of Residence—Justworks can only process payroll using the proper forms based on the Province of Employment.
Need more help?
For more information, visit Canada Revenue Agency or contact Justworks International Support for further guidance.
Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for accounting, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.