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 disability insurance plan payments.
Position: Included in income if the employer has made a contribution.
Reasons: Paragraph 6(1)(f).
XXXXXXXXXX 991536
Wm. P. Guglich
Attention: XXXXXXXXXX
July 14, 1999
Dear Sirs:
Re: Employer Premiums to Short/Long Term Disability Insurance Plans
This is in reply to your letter dated March 15, 1999, requesting our views on the tax treatment of benefits received by employees under a short/long term disability insurance plan.
Amounts paid to an employee on a periodic basis from a disability insurance plan to which an employer has made a contribution are included in the employee’s income by virtue of paragraph 6(1)(f) of the Income Tax Act (the “Act”). In general terms, the amount to be included in income by the employee is the amount by which the total benefits received by the employee before the end of the year exceeds the total of all contributions made by the employee under the plan before the end of the year. Details of the calculation are included in IT-428, Wage Loss Replacement Plans.
We trust our comments will be of assistance to you.
Yours truly,
John Oulton
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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