Does Canada Have a 1099? T4A and NR4 Explained
The Canadian slips that do what a 1099 does — T4A, T5, T3, NR4 — and what a Canadian does with a U.S. 1099 when one arrives
Reviewed by the Fairlight Accounting cross-border tax team — U.S. & Canadian Tax Desks
Canada has no Form 1099. Its information slips do the same job under different names: the T4A reports contractor fees and other non-employment income, the T5 investment income, the T3 trust and fund distributions, and the NR4 payments to non-residents with the tax withheld. A Canadian who receives a U.S. 1099 reports the income in Canada regardless of the form.
On this page
The Canadian slips and their U.S. counterparts
| Canadian slip | What it reports | Closest U.S. form |
|---|---|---|
| T4 | Employment income and deductions | W-2 |
| T4A | Pension, retirement, annuity, and other income — including fees for services (box 048), scholarships, lump-sum payments, and RESP payments | 1099-NEC (contractor fees), 1099-R (pensions), 1099-MISC (other) |
| T5 | Dividends (eligible and non-eligible, with gross-up), interest, and foreign income from Canadian payers | 1099-DIV, 1099-INT |
| T3 | Distributions from trusts, mutual funds, and ETFs — interest, dividends, capital gains, return of capital | 1099-DIV (funds), Schedule K-1 (trusts) |
| T5008 | Securities dispositions — proceeds and, sometimes, cost | 1099-B |
| T4RSP / T4RIF | RRSP and RRIF withdrawals | 1099-R |
| NR4 | Any amount paid to a non-resident subject to Part XIII withholding — dividends, interest, rents, royalties, pensions, RRSP and RRIF payments — and the tax withheld | 1042-S (the U.S. form for payments to foreign persons) |
| T5013 | Partnership income allocations | Schedule K-1 |
The T4A's contractor box is the closest thing to a 1099-NEC, and — as with the 1099 — its issuance is inconsistent: the CRA requires payers to issue a T4A for fees for services, but is not currently assessing penalties for missing box 048 amounts (outside a trucking-industry policy for 2025 and later years), so many Canadian contractors receive none. As in the United States, the slip does not define the income: a contractor reports all business income on Form T2125 whether or not a T4A arrives.
What does a Canadian do with a U.S. 1099?
A Canadian resident who receives a Form 1099-NEC from a U.S. client, or a 1099-K from a U.S. platform, has been reported to the IRS as a recipient of U.S. payments — but the form's existence does not make the income U.S.-taxable. If the services were performed in Canada, the income is foreign-source under U.S. rules and not subject to U.S. tax; the 1099 was probably issued because the Canadian never gave the client a W-8BEN (the W-8BEN guide), and the fix is to provide one so future 1099s stop. If the services were performed in the United States (on-site work), the income may be U.S.-source, and the treaty's business-profits and permanent-establishment rules decide whether U.S. tax is due — while the on-site work itself generally means filing a 1040-NR with Form 8833 to claim the exemption. Either way, the income goes on the Canadian return on T2125 (self-employment) or the appropriate line, converted at the exchange rate on the payment dates or the annual average, with any U.S. tax actually paid claimed as a foreign tax credit.
A 1099-K from a platform reports gross payments including the platform's fees — the Canadian reports the gross as revenue and deducts the fees, as a U.S. freelancer would. A 1099-INT or 1099-DIV from a U.S. bank or broker means the Canadian was treated as a U.S. person (no W-8BEN on file) — the income is reportable in Canada, and the W-8BEN should be filed to restore treaty withholding.
How does a U.S. business pay a Canadian contractor?
The U.S. business collects Form W-8BEN (individual) or W-8BEN-E (corporation) from the Canadian contractor, which documents foreign status. For services performed entirely outside the United States, the payments are foreign-source income of a foreign person: no U.S. withholding, no 1099-NEC, no 1042-S. The business simply deducts the fee as a contractor expense. For services performed in the United States by a Canadian, the payments are U.S.-source: 30 percent withholding applies unless the contractor claims the treaty exemption on Form 8233 (self-employed services are business profits under Article VII, exempt unless there is a U.S. permanent establishment — including the 183-day services rule in Article V(9); the old Article XIV on independent personal services was repealed in 2008; Form 8233 requires an ITIN), and the payment is reported on Form 1042-S, not a 1099. The reverse case — a Canadian business paying a U.S. contractor working from the United States — mirrors it: no Canadian withholding on services performed outside Canada, no T4A required in practice, and Regulation 105 withholding (15 percent) only when the U.S. contractor performs services in Canada (reported on a T4A-NR; waivers on Form R105).
Worked example
A Montreal graphic designer works remotely for three U.S. agencies and one Canadian firm. Agency one collected her W-8BEN at onboarding: no 1099, no withholding — she invoices, they pay, she reports the income on T2125. Agency two never asked for a form and issued a 1099-NEC for US$28,000: the income is foreign-source (she worked in Montreal), no U.S. tax is due on it, and she sends agency two a W-8BEN so next year's 1099 doesn't happen — the US$28,000 goes on T2125 at the exchange rates on the payment dates. Agency three flew her to New York for a two-week on-site project and paid US$9,000: services performed in the United States — U.S.-source — but under the treaty's business-profits article (no U.S. permanent establishment, far short of 183 days) the income is exempt from U.S. tax; she gives agency three Form 8233 (with her ITIN) to prevent 30 percent withholding, and because she worked in the United States that year she files a 1040-NR with Form 8833 claiming the exemption, and the payment appears on a 1042-S. The Canadian firm paid her C$15,000 and issued a T4A with box 048 — reported on T2125 like the rest. Total revenue on T2125: all four clients, four different forms, one tax return.
Frequently asked questions
Does Canada have a 1099 form?
No. Canada uses information slips with different names — the T4A for contractor fees and other income, the T5 for investment income, the T3 for trust and fund distributions, the T5008 for securities sales, and the NR4 for payments to non-residents.
What is a T4A?
The Canadian slip for pension, retirement, annuity, and other income, including fees for services (box 048). It is the closest counterpart to the U.S. 1099-NEC and 1099-R.
I'm Canadian and got a 1099 from a U.S. client. Do I owe U.S. tax?
Not if the work was performed in Canada — the income is foreign-source and not U.S.-taxable. Report it on your Canadian return and give the client a W-8BEN so they stop issuing 1099s. Work performed in the United States may be U.S.-source, subject to the treaty's rules.
Does a U.S. business issue a 1099 to a Canadian contractor?
Not for work performed outside the United States — it collects a W-8BEN or W-8BEN-E and issues nothing. For work performed in the United States, payments are reported on Form 1042-S, with the treaty exemption claimed on Form 8233.
Official sources
The CRA states: “A T4A slip identifies amounts paid during the calendar year for certain types of income from many different sources including self-employed commissions and RESP educational assistance payments.” — Canada Revenue Agency, T4A slip – Information for payers, https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/completing-filing-information-returns/t4a-information-payers/t4a-slip.html
The CRA states: “You have to fill out an NR4 slip for every non-resident to whom you paid or credited amounts described under Part XIII of the Income Tax Act (ITA), even if you are not required to deduct any tax.” — Canada Revenue Agency, When to fill out the NR4 slip, https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/payments-non-residents/nr4-part-xiii-tax/nr4/nr4-slip/when-complete-nr4-slip.html
Next step
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