We have a client who runs a small embroidery business. They have 6 employees including the owner (the owner, 1 bookkeeper/admin, 2 people managing the embroidery machines, 2 people doing most of the manual sewing required).
The building that they own and operate out of has some spare space in the back and the owner was wondering if he would be able to put a small gym back there and make it available to all his staff. My kneejerk thought was obviously no.
However, I’ve done some research and found this topic from CRA. I’m thinking they would fall under the first bullet of the second part where it says the recreational facility doesn’t result in a taxable benefit to the employees if it’s made available to all employees. But does that mean the equipment would be deductible by the corporation (or depending on the cost, claimable as CCA)?
He would likely have to deal with workers comp liability issues if any of his employees get hurt on the exercise equipment but that’s a different issue. Could the business claim gym equipment in this case?