Remote Work From Other Countries
These issues are concerning enough when the employee is seeking to remotely work from a different jurisdiction in Canada. The potential issues are compounded when the proposed jurisdiction is another country.
Every country has different rules regarding the direct employment of a worker who may be working remotely for an employer in Canada. Some remote work for a short duration may be permitted under business or tourism visas. However, a full working visa may be required.
It is possible you, the employer, will be considered to be conducting direct employment in the new country, triggering corporate registration, payroll, statutory deduction and workplace insurance considerations. Also, an employee working remotely from another country may trigger tax consequences for both the employer and employee.
When an employee proposes a new country as a location for remote work, employers cannot assume any duration of work will be allowed and should fully review these issues.
You may be in a situation where you are exposed for not paying EU employment taxes as well as German payroll taxes.
We would recommend sending the T4 to the Canadian address and looking into the employment relationship you currently have, as your employee is no longer a digital nomad and has established residency abroad.
