Frequent Flyer Points Are an Employee Tax-Free Benefit

Up until 2009, CRA took the position that where you accumulate frequent flyer points while travelling on employer-paid business trips and used them to obtain air travel or other benefits for personal use by you or your family, the fair market value of such air travel or other benefits must be included in your income.

For 2009 and subsequent years, the CRA no longer requires frequent flyer points earned while flying on business to be included in an employee's income, so long as:

• the points are not converted to cash,
• the plan or arrangement is not indicative of an alternate form of remuneration, and
• the plan or arrangement s not for tax avoidance purposes.

Where an employer controls the points (e.g., a company credit card is used), the employer will continue to be required to report the fair market value of any benefits received by the employee as income on the employee's T4 slip when the points are redeemed.