Video · From Canada
LLC or C-Corp from Canada? Canada Sees a US LLC as a Corporation (2026)
Running a US company from Canada? Canada treats a single-owner US LLC as a corporation while the IRS looks through it, so the choice of company comes first. 5:02 long, published .
Transcript
What the video says
0:00Can a Canadian resident own a US LLC?
It's late afternoon in Toronto, and Claire's software has landed its first big customer in the US. Their buyers would rather sign with a US vendor, so she's wondering about a US company. On the American side, she can have one. No social security number, and no trip to the US. We're BaseAcross. We set up US companies for founders outside America, so we'll be straight with you. From Canada, the hard part is choosing which kind of company.
Canada sees a US LLC as a corporation, while the IRS looks straight through it.
0:36Do you need a US company for Stripe in Canada?
First, does she need one at all? For card payments, probably not. The big card processor already supports businesses in Canada. A US company adds US filings, and a Canadian return about the company every year, so it needs a reason of its own. Selling into the US as a US vendor is one. Raising from US investors is another, and they usually want a Delaware C-Corp.
Claire sells into the US, so she has her reason.
1:04Should a Canadian form a US LLC or a C-Corp?
Here's the Canadian rule that shapes everything else. A single-owner US LLC is see-through for US tax, so the IRS looks through it to you. Canada treats the same LLC as a corporation. So the two countries tax different things, and credits for one country's tax may not match the other's. A C-Corp is a corporation in both countries, which lines the two up. That's why the guide's answer for a Canadian is often a C-Corp.
Decide with a cross-border accountant before you order.
1:38Delaware C-Corp or Wyoming LLC, and an EIN without an SSN
The American paperwork is the simpler part. A Delaware C-Corp suits selling into the US or raising, and it's a corporation in both countries. A Wyoming LLC comes only after cross-border advice. The company needs a registered agent, an address in that state for legal papers, not where you work. Then the EIN, the company's US tax number. Without a social security number or an ITIN, the application goes on a separate IRS form instead of the online tool.
Prices are in US dollars, so check your card's exchange rate and fees.
2:12Which US accounts work from Canada?
Where can the dollars land? Founders living in Canada can apply to a US fintech bank, because Canada isn't on its list of countries it doesn't serve. The bank decides each application. A multi-currency account can give a US company run from Canada US dollar account details, and it reviews each business. Another US bank doesn't bar Canada, but it asks every owner for a physical US address. Each provider decides for itself. With a US account, Claire's company can apply to the card processor as a US business.
The processor reviews it, and it can decline.
2:50Can Canada treat your US company as Canadian?
Then Canada's side. What the company pays you goes on your Canadian return. The company can count as Canadian too. A company formed abroad is resident in Canada if its central management and control is exercised here, usually where the board meets and decides, and the treaty's tie-breaker then matters. If it's your foreign affiliate, you file a foreign affiliate return with the Canada Revenue Agency every year, within ten months of the end of the tax year. Here's the guide's illustration. Say Claire's company had gross receipts of eighty thousand Canadian dollars in its year, and assets of fifty thousand. Both are under the limits, so it counts as dormant and needs less detail, but she still files. Gross receipts count every receipt, loans included. That's an illustration, not a quote.
And under the FAPI rules, certain passive income of a controlled foreign affiliate is taxed in Canada as it's earned, whether or not it's paid out.
3:44Do you pay US tax, and is there a US–Canada treaty?
In America, there's an income tax treaty with Canada, and it's in force. It exempts most interest from US withholding, caps dividends, and exempts most royalties. Its rules for companies that are see-through in one country and not the other are why a cross-border accountant matters. Pay for work you do in Canada generally isn't US income. A single-owner LLC with no US office or staff often owes no US income tax on it. A single-owner LLC still files a report with the IRS when it has reportable transactions with you, and missing it is expensive. For a calendar-year company, it's usually due in mid-April.
A C-Corp files different returns.
4:28What to do first, in order
Put together, the order runs like this. Start with a cross-border accountant: whether you need a US company at all, whether an LLC or a C-Corp suits you, and where the board will meet. Then form the company, get the EIN, and apply for the accounts. Record where the board meets and every payment between you and the company. Put the US returns, the foreign affiliate return and your Canadian return on one calendar. The full guide, with every source and a checklist for your adviser, is linked below. And Claire?
She's booked the accountant before choosing the company.
The founder in the video is an example, not a customer. The rules in it were checked when it was made; the guide carries the current sources.
The guide
Costs, documents, timelines and the rules in Canada, with sources.
Read the guide for CanadaWatch on YouTube