CRA indicates that employer payments made directly to the insurers rather than through the trustee do not disqualify the plan as an ELHT

CRA indicated that an employee life and health trust (ELHT) can qualify as such under s. 144.1(2) even where the trustee in accordance with the terms of the plan requires participating employers to pay premiums directly to the insurance carriers providing benefits under the plan rather than having the employers make contributions into the plan to fund such premiums. Indeed, CRA stated:

[A] trust established to provide [designated employee benefits] to employees and certain related persons may qualify as an ELHT absent employer contributions. For example, a trust established by a union may qualify an ELHT where the union or participating employees have the legal obligation to fund the entire cost of DEB’s (i.e., an employee-pay-all plan).

Neal Armstrong. Summaries of 29 June 2020 External T.I. 2018-0782541E5 under s. 144.1(2) and s. 144.1(4).