For calendar year 2023 and after, it is mandatory to indicate whether the employee or any of their family members were eligible , on December 31 of that year, to access any dental care insurance, or coverage of dental services of any kind, that you offered.
They also say,
, on December 31st of the taxation year to which the information return relates, a payee or any of their family members were eligible to access dental insurance, or dental coverage of any kind, including health spending and wellness accounts, due to their current or former employment.
So I am trying to figure out former employment, at Dec 31 the employee has quit or got fired and therefore no coverage and it would seem that we should report code 1. But that seems to go against the whole purpose of this reporting, ie could little Johnny have gotten the employer’s health plan to fix his rotten teeth.
I called CRA but could not get an answer and someone is supposed to call back. Wondering if anyone might have a definitive answer.
The whole thing doesn’t seem well thought out. UHT all over again.
I believe it depends on the employment contract. If they were promised to get dental coverage and they had used it, then you would probably record it as code 2.
According to MNP, the reporting is not on an employee’s family situation or what coverage an employee enrolled in. It is on the level of coverage the employee was offered and could have benefitted from on December 31 of that calendar year which would be 2023. So I’m assuming your question is if an employee was fired on December 31st before 11:59 P.M? I believe they’d be considered as code 1. I wouldn’t stress out too much on this. As long as you enter a code on box 45, the CRA will accept the T4 slip. It’s mostly another bs administration work that the CRA wants us accountants to do again.
For those that don’t have dental benefits but had applied for the Canada Dental Benefit for their children, you are not supposed to record that so it would be considered as code 1.
For the upcoming 2023 personal tax course, I’m hoping that Joe and Caitlyn at VTN will be discussing about this in greater detail.
But the question is if an employee had coverage earlier in the year but now is gone. Seems the only T4’s that would get anything else than a code 1 would be current employees as of Dec 31. Seems a bit dumb.
The wording is eligible , on December 31 of that year, to access dental care insurance, or coverage of dental services of any kind, that you offered.
And former employees are no longer eligible as of Dec 31.
The T4 Guide follows the legislation and uses the wording “if you provided access to any dental care insurance or for coverage of dental services of any kind to an employee” but then refers to the T4 Information for Employers page where the wording specifies " For calendar year 2023 and after, it is mandatory to indicate whether the employee or any of their family members were eligible , on December 31 of that year, to access any dental care insurance, or coverage of dental services of any kind, that you offered."
that this says "AN employee, not any employee. In some instances an employer offers insurance to a certain class of employees, but not to others. The important part is to recognize that an employee may have declined to be part of the employer’s plan.
Section 3 of the “Dental Benefit Act” specifies that an individual must make an application in order to access federal dental benefits.
Section 4 deals with eligibility and more specifically paragraph 4(1)(e) refers to the eligibility of an employee who does not have access to dental insurance and makes an application for dental benefits.
Presumably there will be questions on the application that require the claimant to verify whether or not they have access to dental insurance.
Would it be safe to assume that Box 45 of the T4 slip serves only to assist the federal benefits adjudicator in determining whether or not the claimant is a liar?
Who reports on whether or not self employed individuals have access to dental coverage, or is it assumed they are more honest than employees and will answer truthfully on the benefits application?
Interesting comment and not entirely certain this is accurate. My understanding is that if the employee is ELIGBLE to participate, it doesn’t matter if they do or not. It’s about “access”, not about participation.
@SmallBizGuy That’s my point - if they have access, even though they declined, they may not be eligible for government dental. So the T4 would have to indicate that they had access.
Correct - only matters whether it’s “available” to them. I have a number of corp clients with health plans on which one spouse declines. Still “available” for T4 purposes.
The employer offers full family benefits to the husband (including dental coverage for the husband, spouse, and kids), but nothing is offered to his wife (since she is covered under the husband’s plan).
It seems quite obvious that one would indicate a number 3 (Payee, spouse, and dependent children) in box 45 of the husband’s T4 slip.
What would be the appropriate code for the spouse’s T4 slip? Also a number 3?
