What are the tax-free benefits/reimbursements in Canada?

Article author
Mika
  • Updated

Canada offers several tax-free benefits and reimbursements to employees. These benefits are not included in the employee's taxable income and, therefore, are not subject to income tax. Some common tax-free benefits/reimbursements for employees in Canada:

  1. Medical and Dental Benefits: Medical and dental benefits provided by Customer, such as health insurance, prescription drug coverage, and dental care, are generally tax-free for employees except for Quebec-based employees.
  2. Childcare Benefits: Childcare benefits provided by Customer, such as subsidized daycare or childcare vouchers, are often tax-free for employees.
  3. Employee Assistance Programs (EAPs): Employee assistance programs that offer counseling services and support for personal or work-related issues are generally tax-free.
  4. Relocation Expenses: Certain relocation expenses incurred by an employee when moving for work may be tax-free if they meet specific criteria.
  5. Work-Related Travel Expenses: Reimbursements for work-related travel expenses, such as meals, accommodations, and transportation, may be tax-free if they are necessary for business purposes and supported by valid documentation.
  6. Mobile Devices and Internet: Mobile devices provided by Customer and internet services may be tax-free if they are primarily used for business purposes and if they meet specific criteria.

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