Section 144.1

Subsection 144.1(1)

Designated Employee Benefit

Administrative Policy

7 October 2011 Roundtable, 2011-0406551C6 F - Régime coll. d'ass. maladie et les accidents

benefit from a group sickness or accident insurance plan may be paid from a Life and Health Trust to the employee, spouse or dependent child

Can a group sickness and accident insurance plan (a plan consisting of individual insurance policies) also cover employees’ spouses or persons residing with the employee and with whom the employee is connected by blood relationship, marriage or adoption? CRA responded:

[I]t appears to us that the intention of the legislator is that a group sickness or accident insurance plan may provide benefits to an employee, the employee’s spouse or common-law partner or a person related to the employee who lives at home or is dependent on the employee. For the purposes of the Life and Health Trust rules, a benefit from a group sickness or accident insurance plan is a "designated employee benefit" as that term is defined in subsection 144.1(1) and may be paid from a Life and Health Trust to an employee or the employee’s spouse, common-law partner or related person who lives at home or is dependent on the employee.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) - Subparagraph 6(1)(a)(i) PHSP can include spouses and dependent related persons 96

Subsection 144.1(2) - Employee life and health trust

Administrative Policy

S2-F1-C1 - Health and Welfare Trusts

1.9 A trust that provides health and welfare benefits under plans…may be a health and welfare trust or an employee life and health trust. Where a trust qualifies as both a health and welfare trust…and an employee life and health trust, the trust should maintain evidence to support the type of trust arrangement under which it intends to operate.

Paragraph 144.1(2)(f)

Administrative Policy

3 May 2022 CALU Roundtable Q. 4, 2022-0928801C6 - ELHT and Key Employee Rules

s. 144.1(2)(f) does not apply to s. 144.1(2)(e)(ii)

S. 144.1(2)(e) was amended (through the addition of s. 144.1(2)(e)(ii)) to provide, as an alternative to satisfying the “Beneficiary Condition” in s. 144.1(2)(e)(i), that a trusteed plan can qualify as an ELHT where key employees are included as beneficiaries under the plan if the total cost of private health services plan benefits (PHSP benefits) provided to each key employee (and specified related persons) in respect of the year does not exceed $2,500 (the “Alternative Condition”).

Does the requirement of s. 144.1(2)(f) (dating from before the introduction of the Alternative Condition) – that the rights under the trust of each key employee are not more advantageous than the rights of a class of beneficiaries described in s. 144.1(2)(e) - apply only where the Beneficiary Condition is relied upon (so that where the Alternative Condition is met, the plan is not required to satisfy s. 144.1(2)(f))? CRA responded:

The condition in paragraph 144.1(2)(f) … should only apply where a trust meets the condition in subparagraph 144.1(2)(e)(i) … and does not apply to a trust that meets the condition in subparagraph 144.1(2)(e)(ii) …