Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: Tax treatment of premiums paid by an employer on group dependent life insurance.
Position: Premiums paid by an employer are taxable under paragraph 6(1)(a).
As previously noted in 2000-000107, a policy that covers both employees and dependents or dependents only, is not considered a "group term life insurance policy." Therefore, employer's premium payments on such a policy is taxable in the employee's hands.
Reasons: There is no exclusion in the law under subparagraph 6(1)(a)(i) (or any other provision).
XXXXXXXXXX 2000-001822
April 14, 2000
Dear XXXXXXXXXX:
Re: Group Term Life Insurance Policy
This is in response to your letter of March 28, 1990, in connection with our letter of March 8, 2000 (our reference: 2000-000107).
You requested further clarification on your original question. The question is: does the Canada Customs and Revenue Agency consider any premiums paid by an employer for Dependent Life Insurance benefit to be a taxable benefit to an employee?
I believe that we have answered that question in the last paragraph of our response. An employee is taxable on such employer-paid premiums under the general taxing provision for employment benefits (paragraph 6(1)(a) of the Income Tax Act). There is no exclusion under that provision (or any other provision of the Act) for the benefit derived from such employer-paid premiums.
We trust our comments will be of assistance.
Yours truly,
John Oulton
for Director
Business and Publications Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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