Contributions to a Group Insurance Plan (Including a Health Services Plan)
Contributions you pay a group insurance plan for the coverage that a current, past or future employee receives during the year constitute a taxable benefit for the employee.
A group insurance plan can be:
- a private health services plan;
- a group life insurance plan (term or other);
- a group critical illness insurance plan (for conditions such as coma, cancer or paralysis);
- all other group insurance plans, except plans covering total or partial loss of income from an office or employment (if wage loss benefits are payable periodically).
The type of plan and the coverage provided determine the value of the benefit. To calculate the value of the benefit, see the following pages:
- Plan Backed by an Insurance Contract
- Plan Not Backed by an Insurance Contract
- Services Insured by the RAMQ – Coverage Backed by an Insurance Contract
- Services Insured by the RAMQ – Coverage Not Backed by an Insurance Contract
- Paid-Up Life Insurance
Include the value of the benefit in boxes A and J of the employee's RL-1 slip (see courtesy translation RL-1-T) if the coverage is under a private health services plan and in boxes A and L if the coverage is under any other type of plan. You must also include the value of the benefit in box G of the RL-1 slip.
The value of the taxable benefit calculated over the course of the year is based on estimates and must be apportioned over all the pay periods in the year. You can do the calculation using any reasonable estimation method (such as basing the estimates on data for the previous year or on a hypothetical premium). At the end of the year, you have to use the actual data to determine the actual value of the benefit to be entered on the employee's RL-1 slip.
Contributions (or premiums) you pay under a private health services plan for coverage that the surviving spouse or the dependants of a deceased employee receive do not constitute a taxable benefit.
Contributions (or premiums) paid by a current, past or retired employee to a private health services plan that covers, for example, medical or dental costs, do not constitute a taxable benefit for the employee.
However, the contributions (or premiums) paid may entitle the employee to claim a tax credit for medical expenses in his or her income tax return.
To report the amounts that the employee paid to such a plan on the RL-1 slip (see courtesy translation RL-1-T), enter “235” in a blank box, followed by the amount. If you do not enter the amount on the RL-1 slip, the employee may ask you for supporting documents. Do not include this amount in box A.