Employee Perks: Refresh Your Skills with New Advanced Payroll Course

Payroll is a lot more complicated to calculate when employers offer perks to their employees.  But these taxable and tax-free benefits, which can include reimbursement of housing losses and interest-free loans or parking costs, can make it more attractive for employees to sign on and stay. For example, did you know…?

Housing Loss Remibursements may not be fully taxable. If an employer requires an employee to move to take a job, but then reimburses the employee for a loss suffered in selling the family home, only a portion of the reimbursement must be included in income as a taxable benefit. 

Where the loss and reimbursement are both less than $15,000 no taxable benefit will accrue. Where the loss and re-imbursement exceed $15,000 the benefit is one-half of the excess of the lesser of the loss and the reimbursement over $15,000.

Interest-Free and Low-Interest Loans are taxable.  In most instances where an employee receives an interest-free or low-interest loan from the employer, a taxable benefit will accrue to the employee.  However, if that loan is used to make investments, the taxable benefit may be deductible.

Parking Costs may or not be taxabe. Under S. 6(1)(a) of the Income Tax Act, when an employer provides free or subsidized parking, the employee is normally considered to have received an employment benefit based on the FMV of the parking spot.

However, there may be situations where the FMV of the employer-provided parking is difficult to determine; for example, where free parking is generally available to employees and the general public alike, or when there is a limited number of parking spaces and parking is on a first come, first serve basis. In these cases, no taxable benefit will arise.

Where the parking is provided for business reasons, and the employee is regularly required to use their vehicle for employment-related purposes, the employee will not be considered to have received a taxable benefit, either.

In addition, under S. 6(1)(1.1) parking costs are notably not included in the value of a stand-by charge, or auto operating expense benefits, or benefits for disabled employees.

A highly skilled payroll professional working with the business is of critical value, and Knowledge Bureau’s newly updated certificate course, Advanced Payroll for Small Business can help enhance skills.  

Aside from calculating salary and wages, which may qualify for the Canada Emergency Response Benefits, perks and benefits such as the ones above are often overlooked in remuneration discussions.   Many of these are covered in this newly updated certificate course, now available, and there’s an opportunity to take a free trial. 

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