Employer Paid Benefit Premiums in Québec vs. the Rest of Canada
For employees outside of Québec, employer contributions to a private health services plan (such as medical or dental plans) for employees, is not a taxable benefit to the employees. There are no statutory deductions such as Canada Pension Plan contributions, Employment Insurance premiums, or income tax that will apply. Employer paid premiums under a private health services plan are not taxable and won't be reported on the employee's T4 slip.
For employees in Québec, the contributions an employer pays under one of the following group insurance plans for the coverage that a current, past or future employee receives during the year constitute a taxable benefit for the employee:
- a private health services plan
- a group life insurance plan (term or other)
- all other group insurance plans, except plans covering total or partial loss of income from an office or employment.
Québec and Federal statutory deductions apply. These taxable benefits will reported on the employee's RL1. For clients of OnPayroll.ca Canada we look after the proper set up and administration of the benefit premiums and taxability as legislated. That is just one of the ways that we strive to maintain compliance for you, us and the employee.