5 cross-border rules for Canadian restoration firms serving US clients

What to take away

Rule 1: your Canadian policy probably stops at the border

A Canadian crew drying a flooded basement in Buffalo is not automatically covered by the policy it bought for Ontario work. Most Canadian commercial general liability policies carry a territorial limit that ends at the border.

The fix is a US territory endorsement naming the states where you actually work. If the insurer will not write one, a surplus lines policy for the US is the usual alternative. Either way, the certificate you hand a US client has to show US coverage.

Workers' compensation is the second gap. Provincial boards such as WorkSafeBC and WSIB cover injuries in Canada, not on a US job site. Several states require that state's workers' compensation coverage for any employee working there, even for a single day. Confirm the rule with the state's workers' compensation board before you quote.

Auto coverage changes at the same line. Canadian commercial auto policies often limit territory to Canada, so a van that crosses needs a US endorsement or a separate policy. Hired and non-owned auto coverage follows the same logic when you rent a truck or a lift in the US.

Umbrella and excess layers follow the underlying policy's territory. If the primary excludes the US, the umbrella will not fill the hole. Read the territory clause on every layer before you accept the job. For how these policies are priced, see insuring a water restoration business.

Rule 2: certification recognition is not licence recognition

IICRC credentials travel well. US carriers and adjusters commonly accept WRT, ASD and AMRT, and they may also ask for continuing education records and a background check. Keep every technician's certificate and training log in one PDF, dated.

Recognition is not a licence. Some states license mold remediation, asbestos abatement or water damage repair, and a Canadian certificate does not satisfy that licence. Florida, Texas and Louisiana are the states most often cited for mold and remediation registration, but the list changes. Check the authority having jurisdiction for the state where the work happens.

If your scope includes rebuilding drywall or replacing flooring, you may cross from restoration into contracting. That is a different licence, with different exams and insurance minimums, and some states set the dollar threshold low. Confirm with the state contractor board before you promise a full repair.

Provincial trade credentials do not travel either. A Red Seal certificate is not a US licence and does not authorise work on its own. For the Canadian-side picture, see our guide to licensing and compliance.

Rule 3: CRA payroll and GST/HST on US work

CRA implications start with payroll. Canadian employees working in the US stay on Canadian payroll: you withhold CPP, EI and income tax, and you report the income on a T4. The CRA's payroll guidance sets out the withholding and remittance steps.

US payroll can apply as well. A US-resident employee, or a US payroll presence, can trigger Social Security and Medicare withholding, which means registering with the IRS and a state revenue department. The usual trigger is a permanent establishment, a fixed place of business in the US. Short border projects may not create one; repeated jobs can.

The Canada-U.S. tax treaty reduces double taxation but does not remove filing duties. US-source income may need a US return, with a foreign tax credit claimed in Canada. Get an accountant who works both sides before the first US job.

GST/HST turns on place of supply, not the client's address. Work performed in the US for a US client is generally zero-rated, so you charge GST/HST at 0%. Work performed in Canada for a US client follows the normal rules. The CRA's GST/HST for businesses page sets out the place-of-supply tests and the documentation.

A zero-rated invoice needs the client's name, the US address, a description of the service and the place of performance. If you cannot show where the work happened, the CRA may treat the supply as taxable.

Rule 4: price in US dollars, and say who carries the currency risk

Price in US dollars when the client and the loss are both in the US. It removes the conversion guesswork from the client's side and matches the currency their insurer already uses.

If you must quote in Canadian dollars, attach a currency clause naming the exchange rate and the date it is fixed. Without one, a swing in the dollar can take the margin with it.

Show the conversion cost as its own line rather than burying it in labour. A workable formula is:

• Quoted rate = US-dollar rate x (1 + conversion spread + movement allowance)

Your bank publishes the spread; your own tolerance sets the allowance. Keep both numbers on the file so the client can see the arithmetic.

Mobilization is a separate line too. Border wait times, mileage, meals, hotel and per diem belong in a mobilization fee, not in the hourly rate. US adjusters expect those lines and approve them when they are documented.

Payment terms matter more across the border. US insurers often pay in 30 to 60 days, and some pay the policyholder rather than you.

Ask for a deposit or a progress payment before you mobilize, and have the signed work authorization, certificate of insurance and W-9 ready so the claim moves.

Compare your bank's conversion rate with a specialist FX provider; on large jobs the gap is worth checking. For growing into new markets, see our expansion and market guide.

Rule 5: tariffs change your costs and your welcome

Tariffs hit cross-border service work twice: on the price of imported drying equipment, parts and building materials, and on how US buyers read a Canadian vendor.

When a tariff raises the cost of a material you buy often, reprice the estimate and tell the client early. A surprise charge on the final invoice costs more goodwill than a higher opening quote. If your contract has no materials escalation clause, you absorb the increase.

British Columbia has published its response to US tariffs, including support for businesses under tariff-related cost pressure. The province's tariff response page lists the measures and programs for BC firms. Other provinces run their own; check your provincial trade portal before assuming there is no help.

At the federal level, the Government of Canada's Canada-United States overview covers the trading relationship and the supports that apply to cross-border services. Treat it as a starting point, not as advice.

Some US buyers now prefer US-based vendors to avoid border friction. That is a sales problem as much as a pricing one. Speed, current certification and a clean compliance record are what a Canadian crew still sells.

Worked example: a two-day drying job in Grand Forks

A Winnipeg firm quotes a two-day extraction and drying job across the border. The estimator works the numbers in named variables, because the figures change by job:

Two checks decide whether the job is worth taking. First, does the quoted total still clear the firm's target gross margin after the currency line and subsistence? Second, does the state require a licence for the scope, or does drying and extraction alone stay outside it?

If the answer to the second is unclear, the job waits until the state board confirms it. A denied invoice or a stop-work order costs more than the two days of work.

Common questions

Do I need a US business licence to work in the US?

It depends on the state and the scope. Some states require a contractor or mold licence for any paid work; others ask only for registration. Confirm with the state board that licenses the work before you accept the job.

Does my Canadian general liability policy cover a US job?

Usually not without a US territory endorsement. Ask your broker for the endorsement in writing, and ask for the refusal in writing if it is declined. A US surplus lines policy is the common fallback.

How does CRA treat a US job for GST/HST?

Work performed in the US for a US client is generally zero-rated. Work performed in Canada for a US client follows the normal place-of-supply rules. Keep evidence of where the work happened on every invoice.

What happens if a tariff raises my equipment costs mid-job?

You absorb the increase unless the contract has a materials escalation clause. Add one to future quotes, and check your province's tariff response programs for support.

For the Canadian-side filings, wages and records behind all of this, start at the Government of Canada's business and industry portal. Our own compliance checklist covers the filings new owners miss, and our license requirements page covers the credentials that apply before anything else.