How should an Ontario employer handle payroll deductions for an employee who works in two provinces?

The key concept here is "province of employment," which for payroll purposes generally follows where the employee physically reports to work, not simply where your business's head office is located. This determines which province's income tax withholding tables, and other provincial payroll obligations, apply to that employee's pay.

Where an employee genuinely splits their time working in two provinces — say, reporting to an Ontario office part of the time and another provincial location the rest — figuring out the correct province of employment for withholding purposes is a specific, fact-driven exercise based on the actual work arrangement, not something an employer can simply choose for administrative convenience. CRA has rules for determining which province governs in these split situations, and getting it wrong isn't a minor error — it affects which withholding tables apply and can create real reconciliation problems down the road for both the employer and the employee.

Because the right answer depends closely on the specific facts of how the employee's work is actually structured — where they report, how their time is split, and the nature of the arrangement — an Ontario employer with any employee working across more than one province should have that specific situation reviewed rather than defaulting to head-office rules or assuming Ontario automatically governs.