Posted on Jan 3, 2021

Stylistic Accounting & Tax Practice Inc.

Does Meals cost or Allowance that spent on Employees considered a taxable income?
The employer can pay employees a non-taxable allowance for meals. Or even provide them with meals without adding the meal's cost to the employee's taxable income if the following criteria are satisfied.

1- Reason for allowance
The allowance/ or the meals' cost is spent on the employees for staying extra hours right before or right after regular his circular scheduled hours.

2-The overtime as frequent and regular
The frequency of the allowance The overtime should not occur frequently or regularly
For instant: if you are asked to work a few hours of overtime at the end of the regularly scheduled hours, the meal /allowance won't be considered a taxable benefit; it is because those hours are required to meet the deadline of the new project.

3- The amount of allowance/ the cost of meals
A reasonable amount of meal value that not exceeds 23.00 (includes GST) per meal.

That hasn't has been said if the allowance paid as regular and frequent is considered a taxable benefit; therefore, it should consider an income that gets deducted for CPP and income tax.

The taxable benefit is in box 14 "Employment income," and in the "Other information" area under code 40 at the bottom of the employee's T4 slip.
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