Employees whose duties consist in selling goods or negotiating contracts

Any reasonable allowance (including an allowance for the use of a motor vehicle) that you pay an employee for travel expenses incurred during periods when the employee's duties consist in selling goods or negotiating contracts for you is not taxable.

If the allowance is not reasonable, it is taxable and the full amount must be included in boxes A, G, I and L of the RL-1 slip (see courtesy translation RL-1-T).

Employees whose duties do not consist in selling goods or negotiating contracts

A reasonable allowance that you pay the employee is not taxable in the following situations:

• The allowance is paid for a motor vehicle the employee uses for travel in the course of his or her duties.
• The allowance covers travel expenses (other than those related to the use of a motor vehicle) incurred during trips outside the local municipal territory or metropolitan area where your establishment at which the employee normally works (or with which he or she is normally connected) is located.

If the allowance is not reasonable, it is taxable and the full amount must be included in boxes A, G, I and L of the employee's RL-1 slip. This may be the case, for example, if the allowance you pay for a motor vehicle is not based solely on the actual number of kilometres travelled by the employee in the performance of his or her duties.

Travel expenses (including a meal allowance)

In certain situations, an allowance for travel expenses (including a meal allowance) that you pay for an employee's travel within the local municipal territory or the metropolitan area is not taxable. This type of allowance is paid to an employee who is required to travel to more effectively perform his or her duties in a work period. The allowance:

• must primarily benefit you, the employer;
• must be reasonable; and
• must not be combined with another type of remuneration.