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Peter Kupovics, CPA, CMA, MBA

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    • Why Us?
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      • Our Approach
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      • Our Strengths
    • About Us
      • Back
      • About Us
      • How Are We Different?
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      • Back
      • All Services
      • Accounting, HST, and WSIB
      • Taxes, Tax Planning, and Tax Advice
      • Financial Statements and Business Advice
      • Reality Check
      • Payroll
      • Accounting Software
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    • 2024 Automobile Deduction
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Disability Income Insurance

By Liz O'Dowd on September 4, 2012 Comment BubbleLeave a comment

CRA recently noted that where a proprietor purchased a Disability Income Policy, the premium is a non-deductible personal expense. But the receipt of the disability benefits is tax-free.

If a corporation acquires a Policy for the employees, the premiums are generally deductible. If the employee receives the disability benefits they are included in the employee’s income. However, if the individual received the benefit because she or he is a shareholder, the premium paid by the corporation would be included in the individual’s income, under Subsection 15(1). The premium would not be deductible by the corporation. However, any disability benefits received by the shareholder would be tax-free.

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