25 May 1999 Internal T.I. 9910577 - VOLUNTEER DEDUCTION FROM EMPLOYMENT INCOME

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: Is volunteer director of emergency social services eligible for 8(1)(a) deduction?

Position: Question of fact, but likely.

Reasons: The information is incomplete but based on what was sent he likely meets the criteria.

		May 25, 1999

       XXXXXXXXXX  TSO						HEADQUARTERS
D. Duff
      Attention: XXXXXXXXXX
		991057

Volunteer Deduction from Employment Income

This is in response to your memorandum of April 14, 1999, regarding the proposed deduction from employment income for certain volunteers and, in particular, the situation of XXXXXXXXXX.

XXXXXXXXXX states that individual communities in British Columbia are required to have an emergency program and the components of these programs include search and rescue, communications, and emergency social services. XXXXXXXXXX.

The situations he has been involved in include a local snowstorm, a trawler fire and numerous house and apartment fires. He is also required to be away from home for training purposes and to respond to situations away from XXXXXXXXXX, both inside and outside British Columbia. His duties require him to work with the Fire and Police Departments, Victim Services and the Canadian Red Cross, and such duties include seeing to the needs of evacuees requiring food, clothing, lodging or emotional support.

Our comments

The deduction from employment income is in proposed paragraph 8(1)(a) of the Income Tax Act (the “Act”) and is effective for the 1998 taxation year. To obtain the deduction, which is the lesser of $1,000 and the relevant employment income, a taxpayer must meet the following conditions.

1. He or she must be an employee of a government, municipality or public authority,

2. the amount must be included in the employee’s income from an office or employment, and

3. the amount must relate to the performance of the employee’s volunteer duties as an ambulance technician, firefighter, or a person assisting in search and rescue or other emergency situations.

Also there is no deduction for an individual who is employed by the employer in those activities other than as a volunteer.

If XXXXXXXXXX is employed by the municipality, he meets the first condition, and if the honorarium is considered employment income, he meets the second condition. In our view, honorariums would normally be included in income as employment or business income. From the description provided in this situation, it appears the amount would be employment income.

To meet the third condition, the honorarium must be paid to XXXXXXXXXX as a volunteer and his volunteer duties must be in connection with those listed in three above. If his duties include other activities, then only the portion of the honorarium related to the aforementioned duties is deductible under this provision. A volunteer is not defined in the Act, however Black's Law Dictionary defines it as “A person who gives his services without any express or implied promise of remuneration. One who intrudes himself into a matter which does not concern him,...”. In our view, the fact that an individual is receiving a nominal consideration for performing these duties would not, in and by itself, cause the Department to not consider the individual a volunteer. If the amount paid to XXXXXXXXXX is nominal in relation to his activities with respect to this position, we would consider him a volunteer.

Finally, XXXXXXXXXX maintains that his duties are in relation to assistance in other emergency situations. He indicated that some of the situations he was involved in dealt with snowstorms, fires and floods. Emergency is defined in The Concise Oxford Dictionary as a sudden state of danger or a condition needing immediate treatment. In our view, the situations described by XXXXXXXXXX would be considered emergencies as envisaged by proposed paragraph 8(1)(a) of the Act, and there could also be other situations that would be considered to meet the criteria.

In summary, XXXXXXXXXX likely meets the criteria of being employed by and receiving employment income from a government, municipality or public body. Providing he is considered a volunteer involved with emergency situations, he should be allowed the deduction.

Roberta Albert, CA
for Director
Business and Publications Division
Income Tax Rulings and
Interpretation Directorate
Policy and Legislation Branch