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.
Principal Issues: Whether fees paid to an appointed member of a board should be reported on a T4 or T4A slip.
Position: A legal entitlement to a per diem rate of remuneration established in advance is sufficiently fixed or ascertainable to meet the definition of office. Such fees or honoraria are reported on a T4 slip.
XXXXXXXXXX
2012-043449
T. Baltkois
June 22, 2012
Dear Ms. XXXXXXXXXX:
Re: Board Member Honoraria
We are writing in response to your email of January 24, 2012, concerning whether honoraria paid to certain members of the XXXXXXXXXX Board could be reported on a T4A information slip. These amounts are currently reported on a T4 slip.
Where an individual earns income from an office or employment, the amount is required to be reported on a T4 slip. Subsection 248(1) of the Income Tax Act defines an “office” as being, among other things, “the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes … any other office, the incumbent of which is elected by popular vote or is … appointed in a representative capacity … and “officer” means a person holding such an office”. The definition of “employee” in subsection 248(1) of the Act includes an “officer”.
When an individual is a member of a board by virtue of being appointed in a representative capacity and a fixed or ascertainable honorarium or fee is paid, it is our view that the amount would be taxable as income from an office or employment. This position is consistent with case law on the subject, which specifies that a legal entitlement to a per diem rate of remuneration established in advance is sufficiently “fixed or ascertainable” to meet the definition of an “office”. Accordingly, the honoraria paid to board members along with the appropriate source deductions should continue to be reported on a T4 slip.
Where an individual earns income from an office or employment and is required to incur expenses in connection with that office, they may be entitled to deductions under section 8 of the Act where certain conditions are met. For additional information, please refer to Guide T4044, Employment Expenses.
We trust these comments will be of assistance to you.
Yours truly,
Nerill Thomas-Wilkinson
Manager
for Director
Reorganizations Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch
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