If you have a business corporation, your income will normally consist of salary or dividends. However, given the right circumstances, your corporation may be able to lend you money tax-free. There are some things that you need to be aware of. First, if the company extends you a low or no-interest loan, there will be a taxable benefit added to…
The Income Tax Act has broad and general rules requiring most fringe benefits to be included in net employment income. The government wants to discourage employers from substituting tax-free fringe benefits for actual cash compensation to avoid income tax. In the end, the value of a benefit of any kind must be added to your employment income. Examples of Taxable…
Many employers offer a range of benefits to their employees. The value of fringe benefits are considered taxable benefits and are included as income on your paycheque. This begs the question: Are fringe benefits really a benefit? It is possible to get the same benefits yourself for less? You need to know your marginal tax rate, how much benefits will cost you and…
The Income Tax Act requires that the value of all benefits be included in employment income and taxed accordingly. However, there are some provisions of the Income Tax Act and some administrative practices that may allow for tax-free payments. Non-Cash Awards - If your employer provides you with on-cash gifts for say, birthdays, Christmas, or for a wedding, then the value…
