UPDATE - Change to T4's for ALL Employees in 2023
The Canada Revenue Agency has announced that it will require employers to report when employees have been eligible to access dental insurance or dental coverage of any kind, on annual T4 and T4A slips, beginning in 2023.
The T4 and T4A's issued must indicate if a payee or any of their family members were eligible to access dental insurance, including health spending and wellness accounts, as part of their current or former employment.
- This includes access to ongoing (not one-time occurrence/exceptional) dental care coverage, reimbursement, or insurance as an employee or retiree benefit. Whether or not an individual made use of, or accepted coverage/insurance is not reported. Reporting covers only whether or not it was available to them.
- Employers may include Pension Plan Administrators and other organizations that complete T4As and T4s annually.
- This reporting requirement will be mandatory beginning with the 2023 tax year reporting cycle and will continue to be required on an annual basis.
As a result, the following new boxes will be added to the T4 and T4A slips for the 2023 tax year along with specific codes:
- T4 Box 45: Employer-Offered Dental Benefits
- T4A Box 015: Payer-Offered Dental Benefits
- Code 1 - No access to any dental care insurance, or coverage of dental services of any kind.
- Code 2 - Access to any dental care insurance, or coverage of dental services of any kind for only the payee.
- Code 3 - Access to any dental care insurance, or coverage of dental services of any kind for payee, spouse and dependents.
- Code 4 - Access to any dental care insurance, or coverage of dental services of any kind for only the payee and their spouse.
- Code 5 - Access to any dental care insurance, or coverage of dental services of any kind for only the payee and dependents.
Rest assured, if you are a YBL client, we will be reaching out shortly to get clarification on what code is most appropriate for each of your team members.
The measure is part of the government’s effort to implement the Canada Dental Care Plan, which is intended to provide dental coverage for uninsured Canadians with adjusted family net income under $90,000.
Failing to report this information may result in financial penalties for employers.
You can learn more here: https://www.canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2023/employers-pension-plan-administrators-changes-coming-t4-t4a-reporting.html