CRA strictly interprets the s. 6(1)(a)(iv) safe harbour for counselling

S. 6(1)(a)(iv) provides a safe harbour from an employee taxable benefit for counselling services respecting the mental or physical health of the employee or the employee’s re-employment or retirement. CRA considers that this exception “does not include a service that entails more than simply advice, or is preventive or curative treatment.”

If there is a taxable benefit on general principles (which might occur where the service is not principally for the employer’s benefit and is not provided under a private health services plan), CRA considers that it should be valued at what the “employee would have to pay for this service if the employee assistance program did not exist.”

Neal Armstrong. Summary of 21 January 2016 Quebec CPA Personal Income Tax Roundtable, Q. 12, 2016-0624811C6 Tr under s. 6(1)(a)(iv).