Resource Materials

Canada Revenue Agency (CRA) & My Account:
Financial Links:
Meal and Entertainment expenses for events:

Events for all staff are 100% deductible "in respect of one of six or fewer special events held in a calendar year at which the food, beverages or entertainment is generally available to all individuals employed by the person at a particular place of business and consumed or enjoyed by those individuals". This includes the annual Christmas party which is open to all employees.

Gifts and awards:

Employers can give their employees one non-cash gift per year on a tax-free basis to a maximum of $500 for special occasions. Once every 5 years a second Non-cash gift to honour employees' length of service or to recognize other achievements. Gifts certificates are not allowed. If employees go shopping, pick what they want and you reimburse them - this also would not be allowed; however, if the employer buys the employees something they don't want that would be allowed.

Bursary:

An employer that sets up a "bona fide" scholarship program for post-secondary education of employees and their children will receive a deduction for the payments and non-taxable status to the recipient. To be eligible the scholarship must be based on objective criteria, e.g., achievement of a certain grade level.

The fine print suggests that the bursary to a child of an employee does not work if the employee is a shareholder. This is only an issue if the child of the shareholder isn't also an employee.

Scholarships, fellowships, and bursaries, are fully excluded from income if received by an individual that is entitled to claim the education tax credit (i.e. tuition amounts paid during the year). The bursary does not affect the tuition deduction of the recipient. If an employer pays tuition you only get one deduction instead of 2 with the bursary. To qualify, a non-taxable bursary must be reported on an information slip (T4A) and filed with CRA by the end of February of the following year the bursary is paid. The T4A for the bursary is reported by the recipient on his or her individual tax return but is non-taxable.