I have a question regarding the taxation of a US LLC in Canada.
I'm considering opening a US LLC to conduct business from Canada. I own a software business, and since some of my clients are in the US, I'm considering opening an LLC.
In Canada, I'm operating as a sole proprietor in the province of Alberta. As a non-US resident, and given that my company has no permanent establishment in the US, the LLC would function as a pass-through company, and 0 tax would be paid in the US.
I understand LLCs are treated as a corporation in Canada. My question is: Does that mean that the profits made by my LLC are subject to corporate tax in Canada, OR income tax as I pay myself dividends, OR both?
From what I understood from examples I've read online, I would only be taxable in Canada from the dividends I pay myself (Personal income tax) - no corporate tax applies. Therefore, no double taxation applies, provided that no tax is applicable in the US.
Is that correct?
