Vehicle benefit for shareholder - can it go on a T5?

Tax Topics
1

I have a client who uses his corporate owned vehicle personally. He only pays himself via dividends, so we do not have a payroll account set up. I have computed the standby charge and operating benefit, but I am wondering if this an be added to the T5 as other income, or do I need to open a payroll account to report it on the T4. If the latter, what happens to the fact that no CPP was computed on the amount of the taxable benefit?

2

Per: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/benefits-allowances/benefits-allowances-chart.html

Under step 2, just before the list: Special situation for CPP: Only remuneration is a non-cash taxable benefit

Do not deduct CPP contributions if all of the following apply:

  • It is a non-cash taxable benefit (with the exception of security options)
3

You would put it on a T4A