More than one province, and the map nobody drew

Start with province of employment, because it drives the payroll and it is decided per employee rather than per company. The rule looks at the establishment of the employer where the employee reports for work, an establishment being a place the employer owns, leases or rents where employees report or from which employees are paid. There is no minimum time an employee must report there, and an employee's own home office is generally not an establishment of the employer. Where an employee is not required to report anywhere, there is now a step before the old fallback: where a full-time remote work agreement exists and the employee can reasonably be considered attached to an establishment of the employer, province of employment follows that attachment, judged on which establishment supervises them and which one they would report to given the nature of their duties. The federal agency states plainly that it is not reasonable to attach an employee to an establishment in order to avoid deductions in a province. Only where there is no such agreement, or no attachment that can be demonstrated, does it fall back to the establishment the employee is paid from. All of that governs deductions and nothing else.

That determination has a year end consequence companies meet too late. The province of employment is reported on the employee's year end slip, and an employee who worked in more than one province during a year needs a separate slip for each of them. A person who moved in the spring is therefore not one record with a changed address, it is two slips, and the payroll system has to have known that at the time rather than being asked about it months afterwards. Employment standards follow the same person by an entirely different route. Vacation entitlement, statutory holidays and termination notice are set by the province the employee works in, unless the business is in a federally regulated industry, and federal status is decided by what the undertaking is rather than by its size or by whether it operates across a border. An interprovincial trucking company is federal. A retailer with shops in several provinces is not.

Workplace insurance is the registration missed most often, because there is no national body and no single rule. Boards generally expect an out-of-province employer to pay for workers who travel into their jurisdiction, but mandatory registration is gated differently from province to province, in some cases on whether the industry is covered and on a minimum number of workers. The boards do have an agreement among themselves and it is worth knowing exactly what it does, because it is routinely described as something it is not. The general election under it belongs to the WORKER, who must choose one jurisdiction where entitlement could arise in more than one, and not to the employer. There is an employer-side alternative assessment procedure, it applies only to the interjurisdictional trucking and transport industry, and even there it changes where the assessment is paid without removing the obligation to remain registered with each board. There is also a continuity rule, so a worker sent temporarily from one province into another stays covered by the province of origin until they arrive. What none of that does is let a multi-province employer hold one registration.

Then the corporate question, which has the longest tail. Taxable income is allocated among the provinces where the corporation has a permanent establishment, on a schedule attached to the corporate return, using an equally weighted average of two proportions: gross revenue reasonably attributable to the establishment in that province, and salaries and wages paid to its employees. Where one of those is nil the formula collapses onto the other, and a number of industries have their own rules that displace the general one entirely. A corporation with an establishment in only one province allocates everything to it and nothing to a province where it has none. So the whole thing rests on what counts as a permanent establishment, and the definition is considerably broader than a lease. It starts with a fixed place of business, then deems one where the corporation carries on business through an employee or agent established in a place who either has general authority to contract or keeps a stock of the employer's merchandise from which orders are regularly filled, where substantial machinery or equipment is used, where land is owned by a corporation that has an establishment in Canada, and, if there would otherwise be none anywhere, at the head or registered office named in the incorporating documents. It expressly does not arise from dealing through an independent commission agent or broker, or from having a subsidiary somewhere. And an office maintained and controlled by an employee at their own choice and expense is not in itself a permanent establishment of the corporation, which is the fact pattern most remote hires actually are. The payroll test and this test are different tests with different consequences, and the most expensive mistake available on this page is answering one of them and believing you have answered both.