Employer Health Tax

I can't seem to find any specifics on what is included in taxable benefits in determining gross income to calculate the EHT. We have Life, AD&D and MSP as taxable benefits. I find it odd that we would have to include MSP. Have others determined if we include MSP? The FAQ say "generally" all benefits. Thank you in advance.

Comments

  • My reading of it is that MSP wouldn't be included but here is the breakdown of what gets included:

    https://www2.gov.bc.ca/gov/content/taxes/employer-health-tax/employer-health-tax-overview/eht-remuneration#remuneration

  • My Accountant/Payroll staff has researched this and thinks the MSP is included. Jennifer, can you point me to where you found it to be excluded.

  • oops, no you would include it as only private plans are excluded. My apologies :)

  • If you want to confirm it directly with the Province, there's a contact email you can use in the link Jennifer provided. I emailed that link to clarify the exemption amount for municipalities and received a prompt response.

  • Are you guys including honorariums to Council and to Volunteer Fire Dept staff in remuneration? How about volunteer fire call out pay? It looks like just employee's to me.

  • Thank you all for your help once again. Great question Allison. based on the definition of Employee, I would say yes. What do others think?

  • I've emailed the Province to ask the question. I'll let you know when I hear back:)

  • Here is the answer:
    Stipends paid to a Mayor and Council are considered remuneration for the purpose of the employer health tax.

    For volunteer firefighters, if there is an employment relationship, the employer health tax applies on any B.C. remuneration paid by the employer to the employee or former employee in a calendar year.

    For details on “employee” and “employment relationship”, please refer to the webpage “Employer Health Tax Remuneration”: https://www2.gov.bc.ca/gov/content/taxes/employer-health-tax/employer-health-tax-overview/eht-remuneration

  • If someone has clearly found where volunteer firefighters are considered employees please let us know. I don't think they fit the definition of employees and ours get a stipend for attending training courses and a stipend in December based on the number of calls they chose to attend. Doesn't seem like an employee to me even thought he stipends are considered taxable for income tax purposes. I couldn't see where they clearly defined "employment relationship".

  • For details regarding whether a volunteer firefighter is an employee or not... when we answered the questions in the link below under the section "Deciding a worker's employment status in a province or territory other than Quebec" , we came to the conclusion that volunteer firefighters fall under the employer-employee relationship.
    Employee or Self-employed?
    https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4110/employee-self-employed.html#mpl_slf_mpld_wrkr

    I'd be interested if others came to the same conclusion.
    Karen

    Karen Sharp, Village of Radium Hot Springs

  • We will be including our Deputy Fire Chief, Captains and Lieutenants who are the only volunteers that receive a payment at the end of the year. There is an exempted portion, $1,000 I believe, but the rest is taxable. The taxable portion (box 14 amount) we will include in gross payroll for determine EHT.

  • Hi Nyla, Will you be setting up the EHT in your system to calculate the payable or run reports quarterly to determine what amounts are payable?
    Karen

    Karen Sharp, Village of Radium Hot Springs

  • EHT is for organizations with >$500k in payroll, yes? I don't think our village has to worry about this, thankfully!

  • Just curious if anyone has filed this yet. You have to enter the Box 14 income from your T4 summary, which means all of our volunteer firefighter income that is taxable would be included.

    I seem to recall someone higher up saying that this was supposed to be neutral with MSP, however we never paid MSP premiums for our Councillors or volunteer firefighters....

  • Hi Jennifer,
    I have filed. Yes I included Box 14 income from the T4 summary and yes all the volunteer firefighter income with the "up to" $1000 exemption applied (not all our firefighters qualified for the full $1000 exemption) and Council income was included.

    I hadn't heard that it was going to be neutral to MSP...

    Karen Sharp, Village of Radium Hot Springs

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