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Benefits Cost Sharing – Box 85

Posted by Gordon R. Hart

Dec 19th, 2019

Benefits Cost Sharing – Box 85

Organizations who share the cost of the benefit plan with plan members should be aware of Box 85 on the member T4. The portion deducted from employees pay for Health and Dental benefits belong in this section of their T4. Here is the wording from CRA’s website,

If you make contributions to a private health services plan (such as medical or dental plans) for employees, there is no taxable benefit to the employees.

Note

Employee-paid premiums to a private health services plan are considered qualifying medical expenses and can be claimed by the employee on their income tax and benefit return.

Include the amount that the employee paid on a T4 slip in the "Other information" area under code 85. The use of code 85 is optional. If you do not enter code 85, we may ask the employee to provide supporting documents.

Use the T4A slip to report these amounts for former employees or retired employees. Enter the amount under code 135, "Recipient-paid premiums for private health services plans," in the "Other information" area at the bottom of the T4A slip.

For more information on private health services plans, go to New position on private health services plans - Questions and answers and see Interpretation Bulletin IT 339, Meaning of 'private health services plan’ (1988 and subsequent taxation years).

Payroll deductions

Do not deduct CPP contributions, EI premiums, or income tax from benefits you provide to employees under private health services plans.

Benefits Cost Sharing – Box 85

Corporate Office - London

310-700 Richmond Street
London, ON N6A 5C7

Tel: (519) 675-1177

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Sarnia, ON N7T 5P1

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