Example

Box-Case

Amount - Montant

40

2400

98

Note
If more than six codes apply to the same employee, use an additional T4 slip. Do not repeat all the data on the additional slip. Enter only the employer's name and address, and the employee's SIN and name, and complete the required boxes in the "Other information" area. Report each code and amount only once.

Codes 30 to 87 - Taxable allowances and benefits, deductible amounts, employment commissions, and other entries

30	-	Board and lodging
31	-	Special work site
32	-	Travel in a prescribed zone
33	-	Medical travel assistance
34	-	Personal use of employer's automobile or motor vehicle
36	-	Interest-free and low-interest loans
37	-	Employee home-relocation loan deduction
38	-	Security options benefits
39	-	Security options deduction - 110(1)(d)
40	-	Other taxable allowances and benefits
41	-	Security options deduction - 110(1)(d.1)
42	-	Employment commissions
43	-	Canadian Forces personnel and police deduction
66	-	Eligible retiring allowances
67	-	Non-eligible retiring allowances
68	-	Indian (exempt income) - Eligible retiring allowances
69	-	Indian (exempt income) - Non-eligible retiring allowances
70	-	Municipal officer's expense allowance
71	-	Indian employee
72	-	Section 122.3 income - Employment outside Canada
73	-	Number of days outside Canada
74	-	Past service contributions for 1989 or earlier years while a contributor
75	-	Past service contributions for 1989 or earlier years while not a contributor
77	-	Workers' compensation benefits repaid to the employer
78	-	Fishers - Gross income
79	-	Fishers - Net partnership amount
80	-	Fishers - Shareperson amount
81	-	Placement or employment agency workers - Gross income
82	-	Taxi-drivers or drivers of other passenger-carrying vehicles - Gross income
83	-	Barbers or hairdressers - Gross income
84	-	Public transit pass
85	-	Employee-paid premiums for private health services plans
86	-	Security options election
87	-	Volunteer firefighter exempt amount

Detailed instructions for taxable benefits

The following instructions explain how to report each of the benefits in the above list. Some of these benefits must include the goods and services tax (GST) and the provincial sales tax (PST, or QST in Quebec) if they apply, or the harmonized sales tax (HST).

Note
See Guide T4130, Employers' Guide - Taxable Benefits and Allowances, for details on how to calculate the value of these benefits and which taxable benefits are subject to GST/HST.

Code 30 - Board and lodging

If you provided an employee with free or subsidized housing, or board and lodging, enter code 30 and the corresponding taxable amount. Also include this amount in box 14.

Code 31 - Special work site

If the employee received a benefit for board and lodging at a special work site in a prescribed zone and you completed Form  TD4, Declaration of Exemption - Employment at a Special Work Site, enter code 31 and the corresponding amount. Do not include this amount in box 14 or under code 30.

Code 32 - Travel in a prescribed zone

If you provided an employee living in a prescribed zone with an amount for travel assistance, enter code 32 and the corresponding amount. Include this amount in box 14. If any part was for medical travel assistance, see code 33.

Code 33 - Medical travel assistance

If you provided an employee living in a prescribed zone with an amount for medical travel assistance, identify only the medical part under code 33. Ensure the total of the travel assistance is reported under code 32.

Code 34 - Personal use of employer's automobile or motor vehicle

If you provided an employee with the use of an automobile or motor vehicle, enter code 34 and the amount representing the benefit. Include this amount in box 14.

Code 36 - Interest-free and low-interest loans

If you provided an employee with an interest-free or low-interest loan, including a home-purchase and home-relocation loan, because of an office or employment (or intended employment), enter code 36 and the corresponding taxable benefit (resulting from the reduced interest). Include this amount in box 14. If any amount was for a home-relocation loan, see code 37. For more information, see Interpretation Bulletin IT421, Benefits to Individuals, Corporations and Shareholders from Loans or Debt.

Code 37 - Employee home-relocation loan deduction

If the taxable benefit you provided to your employee under code 36 is the result of an interest free or low interest home relocation loan, you have to identify the amount the employee can deduct under code 37. Do not include this amount in box 14.

Code 38 - Security options benefits

If an employee received a taxable benefit under a corporation's agreement to issue its eligible shares or units of mutual fund trusts to the employee, enter code 38 and the corresponding amount. Include this amount in box 14. For more information, go to our Security options page.

Code 39 - Security options deduction - 110(1)(d)

If the employee is entitled to a deduction under paragraph 110(1)(d) of the Income Tax Act, enter code 39 and one-half of the amount you reported under code 38 for those shares. Do not include this amount in box 14. For more information, go to our Security options page.

Code 40 - Other taxable allowances and benefits

If you provided an employee with taxable allowances or benefits that you did not include elsewhere on the T4 slip, enter code 40 and the corresponding amount. Include this amount in box 14. See Guide T4130, Employers' Guide - Taxable Benefits and Allowances, for details on calculating taxable benefits.

Code 41 - Security options deduction - 110(1)(d.1)

If the employee is entitled to a deduction under paragraph 110(1)(d.1) of the Income Tax Act, enter code 41 and one-half of the amount you reported under code 38 for those shares. Do not include this amount in box 14. For more information, go to our Security options page.

Code 42 - Employment commissions

If an employee sold property or negotiated contracts for you, enter code 42 and the amount of the employee's commissions. Include this amount in box 14.

Code 43 - Canadian Forces personnel and police deduction

Canadian Forces personnel and police who are deployed outside Canada on a high‑risk or current moderate‑risk operational mission can claim a deduction from taxable income for the amount of employment earnings they receive during these missions. Enter code 43 and the amount of these earnings, up to the maximum rate of pay earned by a non‑commissioned member of the Canadian Forces. Include this amount with the total employment earnings reported in box 14.

Code 66 - Eligible retiring allowances

Enter the amount of retiring allowances (also called severance pay) that was paid in the year and is eligible for transfer to an RPP or RRSP, even if not transferred. Do not include this amount in box 14. For more information, see Retiring allowances.

Code 67 - Non-eligible retiring allowances

Enter the amount of retiring allowances (also called severance pay) not eligible for transfer to an RPP or RRSP. Do not include this amount in box 14. For more information, see Retiring allowances.

Code 68 - Indian (exempt income) - Eligible retiring allowances

Enter the amount of retiring allowances (also called severance pay) that was paid to an Indian in the year and is eligible for transfer to an RPP or RRSP, even if not transferred. Do not include this amount in box 14. For more information see Retiring allowances on how to report income paid to an Indian.

Code 69 - Indian (exempt income) - Non-eligible retiring allowances

Enter the amount of retiring allowances (also called severance pay) that was paid to an Indian in the year and is not eligible for transfer to an RPP or RRSP. Do not include this amount in box 14. For more information see Retiring allowances on how to report income paid to an Indian.

Code 70 - Municipal officer's expense allowance

If you are a municipal corporation or board and you pay an expense allowance to an elected officer to perform the duties of that office, enter the non-taxable portion under code 70.

Code 71 - Indian employee

If you are an employer paying non-taxable salary or wages to an Indian.

Code 72 - Section 122.3 income - Employment outside Canada
If your employee is employed outside Canada and is entitled to an overseas employment tax credit, under section 122.3 of the Income Tax Act, enter the qualifying amount under code 72. See Employment outside Canada.

Code 73 - Number of days outside Canada

If your employee is entitled to an overseas employment tax credit, enter the number of qualifying days outside Canada under code 73. See Employment outside Canada.

Code 74 - Past service contributions for 1989 or earlier years while a contributor

If an employee made past-service contributions to a registered pension plan (RPP) for employment in 1989 or earlier years while a contributor to an RPP, see Box 20 - RPP contributions.

Code 75 - Past service contributions for 1989 or earlier years while not a contributor

If an employee made past-service contributions to a registered pension plan (RPP) for employment in 1989 or earlier years while not a contributor to an RPP, see Box 20 - RPP contributions.

Code 77 - Workers' compensation benefits repaid to the employer

Enter the amount of workers' compensation benefits repaid to the employer that was previously included in the employee's salary. This allows employees to claim a corresponding deduction as other employment expenses on their income tax and benefit returns.

Code 78 - Fishers - Gross income

See Fisher - Gross income

Code 79 - Fishers - Net partnership amount

See Fisher - Net partnership amount

Code 80 - Fishers - Shareperson amount

See Fisher - Shareperson amount

Code 81 - Placement or employment agency workers Gross income

See Placement or employment agency workers.

Code 82 - Taxi-drivers and drivers of other passenger-carrying vehicles Gross income

See Barbers and hairdressers, and taxi drivers and drivers of other passenger-carrying vehicles.

Code 83 - Barbers or hairdressers Gross income

See Barbers and hairdressers, and taxi-drivers and drivers of other passenger-carrying vehicles.

Code 84 - Public transit pass

Individuals can claim the cost of monthly or longer duration public transit passes. Public transit includes transit by local bus, streetcar, subway, commuter train or bus, and local ferry. Eligible transit passes must allow for unlimited use for the period they are valid and must be for transit in Canada.

The public transit pass includes costs for:

• weekly passes if you purchase enough of these passes so that you are entitled to unlimited travel for at least 20 days in any 28 day period. Each pass must give the holder the right to unlimited public transit use within an uninterrupted period for at least 5 days; and
• the use of an electronic payment card if the card is:
  • used for at least 32 one-way trips during an uninterrupted period not exceeding 31 days; and
  • issued by a public transit authority that records and provides a receipt for the cost and usage of the card.

Enter the total of amounts paid by the employee (for example, through payroll deductions) to purchase public transit passes. Also include amounts that you paid on behalf of the employee that are reported as a taxable benefit (code 40). The taxable benefit portion must also be included in employment income (box 14).

Code 85 - Employee-paid premiums for private health services plans

An employee can claim, as a qualifying medical expense, premiums he or she paid to a private health services plan. Do not include this amount in box 14. The use of code 85 is optional; however, if you do not use this code, we may ask the employee to provide supporting documents. For more information, see Interpretation Bulletin IT-339, Meaning of private health service plan (1988 and subsequent taxation years).

Code 86 - Security options election

Enter the total amount of the security option cash-outs that you have elected not to claim as an expense. This amount is already included in box 14.

Filing T4 slips

For a description of the filing methods available, see Chapter 4 - T4 information return or go to Filing T4 information returns electronically.

Chapter 3 - T4 Summary

If you are filing your return electronically, do not send us a paper copy of the slips or summary. For information about filing electronically, see Filing methods, or go to Filing Information Returns Electronically (T4/T5 and other types of returns).

If you are filing on paper, use the T4 Summary, Summary of Remuneration Paid, to report the totals of the amounts reported on the related T4 slips. Send the original summary and the related slips to the Ottawa Technology Centre.

As part of our continuing efforts toward sustainable development, we no longer mail out the pre printed T4 Summary. You can get a T4 Summary from our Web site at Forms and publications or by calling 1-800-959-2221.

Completing the T4 Summary

Report amounts in Canadian dollars and cents, even if they were paid in another currency. To get the average exchange rates, go to What are the average exchange rates?

Complete a separate T4 Summary for each of your payroll accounts. The totals you report on your T4 Summary have to agree with the totals you report on your T4 slips. Errors or omissions can cause unnecessary processing delays.

Detailed instructions

In the area at the top of the T4 Summary, enter the 15-character payroll account number that you use to send us your employees’ deductions, your operating or trade name, and your address.

Year

Enter the last two digits of the calendar year for which you are filing the return.

Line 14 - Employment income

Enter the total of box 14 from all T4 slips.

Line 16 - Employees' CPP contributions

Enter the total of box 16 from all T4 slips.

Line 18 - Employees' EI premiums

Enter the total of box 18 from all T4 slips.

Line 19 - Employer's EI premiums

Enter your share of EI premiums (multiply the employees' total premiums by the employer's premium rate).

Line 20 - Registered pension plan (RPP) contributions

Enter the total of box 20 from all T4 slips.

Line 22 - Income tax deducted

Enter the total of box 22 from all T4 slips.

Line 27 - Employer's CPP contributions

Enter your share of CPP contributions.

Line 52 - Pension adjustment

Enter the total of box 52 from all T4 slips.

Lines 74 and 75 - Canadian-controlled private corporations or unincorporated employers

Enter the social insurance numbers of any proprietors or principal owners.

Lines 76 and 78 - Person to contact about this return

Enter the name and telephone number of a person that we can call to get or clarify information on the T4 Summary.

Line 80 - Total deductions reported

Add the amounts reported on lines 16, 27, 18, 19, and 22 of the T4 Summary. Enter the total on line 80.

Line 82 - Minus: remittances

Enter the amount you remitted for the year under your payroll account number.

Note
A remittance that was due in January  of the current year (for deductions made in December of the previous year) is considered late when paid with the previous year's information return (T4, T4A) and this return is filed after the remittance due date.

Difference

Subtract line 82 from line 80. Enter the difference in the space provided. If there is no difference between the total deductions you reported and the amount you remitted for the year, leave lines 84 and 86 blank. Generally, we do not charge or refund a difference of $2 or less.

Line 84 - Overpayment

If the amount on line 82 is more than the amount on line 80 (and you do not have to file another type of return for this account number), enter the difference on line 84. Attach a note indicating the reason for the overpayment and whether you want us to transfer this amount to another account or another year, or refund the overpayment to you.

Line 86 - Balance due

If the amount on line 80 is more than the amount on line 82, enter the difference on line 86.

Amount enclosed

Whether you file electronically or file a paper return, you can make your payment in several different ways:

• My Payment is a payment option that allows you to make payments online, using the CRA’s Web site, from an account at a participating Canadian financial institution. For more information, go to My Payment.
• You may be able to pay electronically using your financial institution’s telephone banking, or automated bank machines. Contact your financial institution for more information.
• You can make your payment at your Canadian financial institution. Complete your remittance form and present it with your payment. The financial institution will date stamp the bottom part and return the top part to you as a receipt.
• You can also send a cheque or money order payable to the Receiver General to any tax centre, with a letter that indicates the tax year for which the payment applies, the amount covering your outstanding balance, and your payroll account number.
• You can enclose a cheque or money order payable to the Receiver General for the balance owing with your T4 information return.
  

  Notes
  Regardless of the filing method, Threshold 2 remitters must remit any balance due electronically or in person at their Canadian financial institution.
  
  Threshold 2 remittances that are received by the CRA at least one full day before the due date will be considered to be received by a financial institution and a penalty will not be charged. See Guide T4001, Employers’ Guide - Payroll Deductions and Remittances, for more information about Threshold 2 remitting requirements.
  
  If you remit your payment late, any balance owing may be subject to penalties and interest at the prescribed rate.

Line 88 - Total number of T4 slips filed

Enter the total number of T4 slips that you are including with the T4 Summary.

Chapter 4 - T4 information return

In all instances, you have to file your T4 information return on or before the last day of February following the calendar year to which the information return applies. If the due date falls on a Saturday or Sunday, or a public holiday, your return is due the next business day.

We consider your return to be filed on time if we receive it or it is postmarked on or before the due date. If you fail to file it on time, we may assess a penalty. See Penalties and interest.

If you have more than one payroll account, you will have to file a separate information return for each account.

If you have overpaid, include a letter explaining the reason for the overpayment and how you want us to apply it. If you owe an amount, indicate on your cheque the account and tax year of the payment.

Service bureaus filing returns

If a service bureau is filing an information return for you, you are still responsible for the accuracy of the information, for any balance owing, and for filing on time.

Branch offices filing returns
If the branch office of a company has sent in CPP contributions, EI premiums, and income tax deductions under a separate account that only that branch uses, file the T4 information return of that branch as a separate return.

Filing methods

If you file 1 to 50 T4 slips, we encourage you to file over the Internet in eXtensible mark-up language (XML) by Internet File Transfer. However, you can file up to 50 T4 slips on electronic media (DVD, CD, or diskette) or on paper.

If you file more than 50 T4 slips for a calendar year, you must file the return over the Internet.

If you use commercial or in house-developed payroll software to manage your business, you can file up to 150 MB by Internet File Transfer. For example, a service bureau can file multiple T4 returns in one submission, provided the total submission does not exceed the 150 MB restriction.

Note
If your return is more than 150 MB, you can either compress your return or you can divide it so that each submission is no more than 150 MB.

For more information about these filing methods, go to our Filing Information Returns Electronically (T4/T5 and other types of returns) page.

Filing over the Internet

• Internet File Transfer - Internet File Transfer allows you to transmit an original or amended return with a maximum file size of 150 MB. All you need is a Web browser to connect to the Internet, and your software will create, print, and save your electronic T4 information return in XML format. For information about this filing method, contact your software publisher or go to our Filing T4 information returns electronically page. If your file is more than 150 MB, you can still file using the Internet File Transfer application by either:
  • compressing the file; or
  • separating the file into two or more files. The summaries must reflect the same split.
• Web Forms - The Web Forms application allows you to create and electronically file an original or amended T4 information return containing 1 to 50 T4 slips. This application allows you to validate data in real time, calculate the totals for the Summary, print and save T4 slips, and securely submit encrypted T4 information returns over the Internet. For more information, go to T4 Web forms.
• T4 Desktop application - This convenient filing method is for employers who have to file 1 to 70 T4 slips. This downloadable desktop application lets you create, save, print, and submit your electronic T4 information return, which includes the T4 slips and the related T4 Summary. For information about this filing method, go to our Filing T4 information returns electronically page.

Internet filing is available from January 9, 2012, to early December 2012.

Web access code

To file your return using Internet File Transfer, Web Forms, or T4 Desktop application, you need a Web access code (WAC), unless you are filing through My Business Account or Represent a Client. If you qualify, you will receive a letter providing you with your WAC. If you do not receive a WAC, you can get one at our Filing Information Returns Electronically (T4/T5 and other types of returns) page or call our help desk at 1-877-322-7849.

Note
Service bureaus use their own payroll account number and Web access code (WAC) - not the WAC of each of the T4 information returns in the submission - to submit the file.

Filing without a Web access code

You can also file your T4 information return without a Web access code, using Internet File Transfer (up to 150 MB) or Web Forms (up to 50 slips). Choose the “File a return” option at:

• Represent a Client, if you are an authorized representative or employee; or
• My Business Account, if you are the business owner.

Log in to My Business Account using your CRA user ID and password. If you have not registered with My Business Account, go to My Business Account. You will need to enter information from either your current or previous year’s personal income tax and benefit return. A CRA security code will be mailed to your address on file within five business days. The separate mailing of the security code is a measure used to protect you from identity theft and to ensure the security of your personal information. Be sure to have your business number on hand when registering.

Filing on paper

If you file 1 to 50 T4 slips, we encourage you to file over the Internet using Internet File Transfer or Web Forms. However, you can file up to 50 T4 slips on paper.

Complete one copy of the T4 slip for each employee and send them with your T4 Summary. Enter the information for two different employees on one sheet. This will allow us to process your information return faster. You must keep a copy of the T4 slips and the T4 Summary for your files.

After you complete your paper return, mail it to the:

Ottawa Technology Centre
Canada Revenue Agency
875 Heron Road
Ottawa ON K1A 1G9

Filing on electronic media

For an explanation of the technical specifications and instructions you need to file on electronic media (DVD, CD, or diskette), go to our Filing on electronic media page.

Do not send a printed copy of the forms to us. You can print one copy to keep for your file.

Mail your submission to:

Electronic Media Processing Team
Ottawa Technology Centre
Canada Revenue Agency
875 Heron Road
Ottawa, ON  K1A 1A2

Note
If you use electronic media (DVDs, CDs or diskettes) to file more than 50 information returns (slips), you are now required to file by Internet File Transfer in eXtensible mark up language (XML).

How to file and distribute your T4 slips and T4 Summary

To file your information return electronically, follow the instructions and technical specifications at Filing Information Returns Electronically (T4/T5 and other types of returns).

If you file your information return on paper, send a copy of each T4 slip to the CRA with your T4 Summary, and keep one copy for your records.

You must give employees their T4 slips on or before the last day of February following the calendar year to which the slips apply. If you do not, you may be subject to a penalty. The penalty for failing to distribute T4 slips to recipients is $25 per day for each such failure with a minimum penalty of $100 and a maximum of $2,500.

Give the employee one of the following:

• two copies, sent by mail to their last known address;
• two copies, delivered in person; or
• one copy distributed electronically (for example, by email) if you have received the employee’s consent in writing or electronic format.

We suggest that you print the two T4 slips that you have to give to each employee on one sheet. For security purposes, do not print your payroll account number (box 54) on these copies.

Note
If T4 slips are returned as undeliverable, we suggest that you retain the slips with the employee’s file.

For more information on how to complete the T4 slip and the T4 Summary, see Completing T4 slips and Completing the T4 Summary.

Chapter 5 - After you file

When we receive your information return, we check it to see if you have prepared it correctly. After an initial review, we enter your return into our processing system, which captures the information and performs various validity and balancing checks. If there are any problems, we may contact you.

We also verify the calculations you made on the T4 slips to make sure that the pensionable and insurable earnings you reported agree with the CPP and EI deductions you remitted. For more information, see Chapter 4 of Guide T4001, Employers' Guide - Payroll Deductions and Remittances.

Amending, cancelling, adding, or replacing slips

Amending slips

After filing your information return, you may notice that you made an error on a T4 slip. If so, you will have to prepare an amended slip to correct the information. Provide copies to your employee as described at How to file and distribute your T4 slips and T4 Summary.

If you receive a pensionable and insurable earnings review (PIER) report, do not send us amended slips. Instead, respond to the PIER advising of the changes required for the employees on the listing. For more information, see Chapter 4 of Guide T4001, Employers' Guide - Payroll Deductions and Remittances.

Amending slips over the Internet

Web Forms

The Web Forms application allows you to create and electronically file 1 to 50 slips in an amended T4 information return in a single session. For more information about amending information returns using Web Forms, go to T4 Web forms.

Internet File Transfer

If you use payroll, commercial, or in-house developed software to manage your business, you can submit amended files of up to 150 MB over the Internet. You can file amended slips electronically even if you filed the original return on paper or on electronic media.

• The summary, slips and T619 - Electronic Media Transmittal Record must show the appropriate report type code.
• The file format must be in eXtensible mark up language (XML) as specified in the electronic media specifications.
• The file name must have the extension specified in the electronic media specifications.
• The filer number (Business Number, Filer Identification Number) must be valid.

For more information about amending information returns using Internet File Transfer, go to Filing Information Returns Electronically (T4/T5 and other types of returns).

T4 Desktop application

The T4 Desktop application allows you to create and electronically file 1 to 70 slips in an amended T4 information return in a single session. For more information about amending information returns using the T4 Desktop application, go to Filing Information Returns Electronically (T4/T5 and other types of returns).

Amending slips on paper

Clearly identify the new slips as amended slips by writing “AMENDED” at the top of each slip. Make sure you complete all the necessary boxes, including the information that was correct on the original slip. Send two copies of the amended slips to the employee.

Send one copy of the amended slips to any tax centre with a letter explaining the reason for the amendment. Do not file an amended T4 Summary.

Cancelling slips

Cancelling slips over the Internet

A cancelled slip is considered to be the same as an amended slip. See Amending slips over the Internet.

Cancelling slips on paper

Send us a copy of the original slip clearly marked “CANCELLED”, with a letter explaining the reason to any tax centre. Do not file a cancelled T4 Summary. Send two copies of the cancelled slip to the employee.

Note
If you notice errors on the T4 slips before you file them with us, you can correct them by preparing new information slips and removing any incorrect copies from the return. If you do not prepare a new slip, initial any changes you make on the slip. Be sure to also correct the T4 Summary.

Adding slips

After you file your T4 information return, you may discover that you need to send us additional T4 slips. If you have original slips that were not filed with your return, file them separately either electronically or on paper.

If the total number of T4 slips you file is more than 50 slips for the same calendar year, you have to file the additional slips over the Internet.

Adding slips over the InternetA

We accept additional original T4 slips in electronic format. For more information, see Filing methods.

Adding slips on paper

When submitting additional slips on paper, clearly identify the new slips by writing "ADDITIONAL" at the top of each slip. Send a copy of the slips to any tax centre. Do not file an additional T4 Summary.

Replacing slips

If you issue T4 slips to replace copies your employees lost or destroyed, do not send us copies of these slips. Clearly identify them as duplicate copies, and keep a copy for your records.

Amending, cancelling, or adding slips without a Web access code

You can amend, cancel, and file more information slips using the “File a return” service at:

• Represent a Client, if you are an authorized employee or representative; or
• My Business Account, if you are the business owner.

In a single submission, Internet File Transfer allows for the transmission of 150 MB of information and Web Forms allows the filing of one return with a maximum of 50 slips.

Pension adjustment (PA)

You have to recalculate a pension adjustment (PA) in a registered pension plan when all of the following conditions are met:

• an employee returns from a leave of absence or a period of reduced service;
• the service was not previously pensionable service; and
• by April 30 of the following year:
  • benefits are retroactively provided under a defined benefit provision for the period concerned and the employee makes the commitment to purchase the benefits; or
  • retroactive contributions are made by the employee or the employer to a money purchase provision.
    
    Note
    If the commitment to purchase benefits is made after April 30, a past service pension adjustment will be calculated.

  If a recalculated PA applies, you have to report an amended PA for each year after 1989 that is affected by the leave.

  You do not have to report an amended PA when the difference between the previously reported PA and the amended PA is less than $50. However, you do have to report one if an employee asks you to accurately report the PA, or if we ask you to report the amended PA.

  For the years in which you did not previously report a PA for the employee, you have to file an amended T4 slip showing the correct PA. If you previously reported a PA for the employee in a particular year, you have to show the total PA that applies for that year on an amended T4 slip.

  For information on recalculating a PA, see Guide  T4084, Pension Adjustment Guide. For information on calculating and reporting a past service pension adjustment (PSPA), see Guide  T4104, Past Service Pension Adjustment Guide.

  Data used by other programs

  Other federal government departments use T4 information. For example, Human Resources and Skills Development Canada (HRSDC) uses the information on the T4 slip to update a person’s record of earnings file.

  The information on CPP contributions that we send to HRSDC determines the CPP benefits that a person will receive.

  Chapter 6 - Special situations

  Barbers and hairdressers, and taxi drivers and drivers of other passenger carrying vehicles

  If these workers are your employees, you have to deduct CPP/QPP contributions, EI premiums, PPIP premiums, and income tax as you would for regular employees. If these workers are not your employees, you have to complete a T4 slip for EI and PPIP purposes only. Complete the following entries on the slip.

  Employer’s name

  Enter your operating or trade name.

  Employee’s name and address

  Enter the worker’s name and address, including the province or territory and postal code.

  Box 10 - Province of employment

  Enter the provincial or territorial abbreviation to show where the worker reported for work (see Box 10 - Province of employment list).

  Box 12 - Social insurance number

  Enter the social insurance number (SIN) shown on the worker’s SIN card.

  Box 14 - Employment income

  Leave this box blank. See Other information.

  Box 18 - Employee’s EI premiums

  Enter the EI premiums remitted on behalf of the worker (worker’s part only).

  Box 24 - EI insurable earnings

  Enter the amount of the worker’s insurable earnings on which you calculated the EI premium, up to a maximum of $44,200 for 2011. Enter "0" if there are no insurable earnings.

  Box 29 - Employment code

  Enter the appropriate code for the occupation of the worker. Enter code 13 for a barber or hairdresser or code 12 for a taxi driver or driver of another passenger-carrying vehicle.

  Box 55 - Employee’s PPIP premiums

  Enter the PPIP premiums remitted on behalf of the worker (worker’s part only) while he or she worked in Quebec.

  Box 56 - PPIP insurable earnings

  For workers working in Quebec, enter the total amount used to calculate the worker’s PPIP premiums, up to a maximum of $64,000 for 2011.

  Other information

  Enter the amount of gross earnings of the worker, using code 83 for a barber or hairdresser and code 82 for a taxi driver or driver of another passenger-carrying vehicle.

  Employees with power saws or tree trimmers

  If you are an employer in the forestry business, you may have employees who, according to their contracts, have to use their own power saws or tree trimmers at their own expense.

  In box 14, Employment income, include rental payments you made to employees for the use of their own power saws or tree trimmers. You should not reduce the amount in box 14 by the cost or value of saws, trimmers, parts, gasoline, or any other materials the employee supplies.

  Employees outside Canada

  In situations where you pay CPP on behalf of your employee who is working outside Canada, for all or part of the year, you have to prepare a T4 slip. See Box 29 - Employment code, for specific T4 reporting instructions.

  Overseas employment tax credit

  If you employ a resident of Canada to work outside Canada for more than six consecutive months, the employee may be entitled to an overseas employment tax credit. The six consecutive months of employment can start in the current year or in a previous year. The employment duties performed outside Canada must either be to get a contract for the employer or relate to a contract under which the employer carried on business outside Canada. See Interpretation Bulletin IT-497, Overseas Employment Tax Credit, and Chapter 7 of Guide T4001, Employers’ Guide - Payroll Deductions and Remittances.

  How to complete the T4 slip

  Box 14 - Employment income
  Report the total amount of remuneration you paid that relates to any employment outside Canada. Do this even if an employee has received a letter of authorization from a tax services office or tax centre that allows you to reduce the amount of income tax you deduct from the employee's income.

  On the slip, show the income that qualifies for the reduction and the number of days the employee worked outside Canada.

  In the "Other information" area, enter in one of the boxes code 72 and the income qualifying under section 122.3 of the Income Tax Act. Also, enter in one of the boxes code 73 and the number of days the employee worked outside Canada. The number of days should be a three-digit number that you enter at the beginning of the box "Amount."

Fishing income

Fishing income is reported on the T4 slip.

Fishing income (for example, proceeds of the catch paid to a self-employed fisher) and employment income (for example, plant income) can be reported on the same T4 slip or on separate T4 slips.

The instructions that follow are for fishing income paid to a self employed fisher. For instructions on paying employment income to an employee, see the detailed instructions.

Notes
Do not use code  78, 79, or 80 to report employment income. Use box 14. See Box 14 - Employment income.

Reporting paid or payable self-employed fisher income depends on whether you are using the cash method or accrual method of accounting. For an explanation of these methods, see Chapter 1 of Guide T4004, Fishing Income.

For more information on fishing income, see Guide T4005, Fishers and Employment Insurance and Guide T4004, Fishing Income.

Employer’s name

Enter your operating or trade name.

Employee’s name and address

Enter the fisher’s name and address, including the province or territory and postal code.

Box 10 - Province of employment

Enter the provincial or territorial abbreviation to indicate where the fisher reported for work (see Box 10 - Province of employment list).

Box 12 - Social insurance number

Enter the social insurance number (SIN) shown on the fisher’s SIN card.

Box 14 - Employment income

Leave blank. Fishing income is reported using codes 78, 79, and 80. See the Other information - Fishing income section .

Boxes 16 and 17 - Employee’s CPP/QPP contributions

Do not complete this box. Fishing income is not subject to CPP/QPP contributions.

Box 18 - Employee’s EI premiums

Enter the EI premiums you deducted from the fisher’s gross income.

Box 24 - EI insurable earnings

Enter the amount of the fisher’s insurable earnings on which you calculated the EI premiums, up to a maximum of $44,200 for 2011. Enter “0” if there are no insurable earnings.

Box 26 - CPP/QPP pensionable earnings

Enter “0”, since fisher earnings are not pensionable.

Box 28 - Exempt (CPP/QPP, EI, and PPIP)

Enter an "X" under CPP/QPP (fisher earnings are not pensionable).

Box 29 - Employment code

Enter code 17.

Box 55 - Employee’s PPIP premiums

Enter the PPIP premiums you deducted from gross income of fishers working in Quebec.

Box 56 - PPIP insurable earnings

For fishers working in Quebec, enter the total amount used to calculate the fisher’s PPIP premiums, up to a maximum of $64,000 for 2011.

Other information - Fishing income

Code 78 - Fishers - Gross income

Enter the amount paid or payable to the fisher from the proceeds of a catch. Do not include this amount in box 14.

In addition, report either the net partnership or owner amount using code 79 or the shareperson amount using code 80.

Note
This income does not include amounts paid for a catch or part of a catch made by other persons who were not members of the crew. For more information, see "Calculating the insurable earnings of a fisher" in Guide T4005, Fishers and Employment Insurance.

Code 79 - Fishers - Net partnership amount

Enter the amount that is the product of the gross income (or gross value of the catch) reported under code 78, minus the 25% prescribed amount and the total amount paid to the sharepersons reported under code 80, multiplied by your partnership agreement allocation. (See Example 5 in Guide T4005, Fishers and Employment Insurance.) Include this amount in box 24 (box 56 for fishers in Quebec). Do not include this amount in box 14.

Code 80 - Fishers - Shareperson amount

Enter the amount paid or payable to the fisher from the proceeds of a catch based on the sharing arrangement agreed to before embarking on the fishing trip. Include this amount in box 24 (box 56 for fishers in Quebec) and with code 78. Do not include this amount in box 14.

Indians

The salary or wages you paid to an Indian may be taxable, tax-exempt, or partly tax-exempt. Use Form TD1-IN, Determination of Exemption of a Status Indian's Employment Income, to determine the type of exemption that applies to an Indian’s employment income. For more information, you can also refer to Chapter 7 of Guide T4001, Employers’ Guide - Payroll Deductions and Remittances.

Taxable salary or wages

If you are an employer paying taxable salary or wages to an Indian, you have to deduct CPP/QPP contributions, EI premiums, and income tax, as well as PPIP premiums (for workers in Quebec). Complete all boxes of the T4 slips in the usual way.

Note
If you paid a retiring allowance to an Indian, see Retiring allowances and Code 68 - Indian (exempt income) - Eligible retiring allowances and Code 69 - Indian (exempt income) - Non-eligible retiring allowances, for more detailed information.

Tax-exempt salary or wages

If you are an employer paying tax-exempt salary or wages to an Indian, you do not have to deduct CPP/QPP contributions; however, you have to deduct EI premiums, and PPIP premiums (for workers in Quebec). For more information, see Guide T4001, Employers' Guide - Payroll Deductions and Remittances.

How to complete the T4 slip

Prepare the T4 slip in the following way when you pay a tax-exempt salary to an Indian.

Box 14 - Employment Income

Leave this box blank. Instead, in the "Other information" area, enter code 71 and the amount of the exempt salary or wages paid in the year.

Boxes 16 and 17 - Employee's CPP/QPP contributions

The employment of an Indian whose income is exempt from tax is excluded from pensionable earnings.

If you did not elect to provide CPP/QPP coverage to all your Indian employees on their tax exempt employment income, leave this box blank.

If you did elect to provide CPP/QPP coverage, enter the CPP/QPP contributions you deducted from the employee's earnings.

Box 18 - Employee's EI premiums

Tax-exempt salary or wages paid to an Indian are insurable earnings subject to EI premiums. Enter the EI premiums you deducted.

Box 20 - RPP contributions

Leave this box blank. Registered pension plan (RPP) contributions made with respect to tax-exempt employment income are not deductible by the employee.

Box 24 - EI insurable earnings

Enter the amount of insurable earnings on which you calculated the EI premiums, up to a maximum of $44,200 for 2011. Enter “0” if there are no insurable earnings.

Box 26 - CPP/QPP pensionable earnings

If you did not elect to provide CPP or QPP coverage to all your Indian employees on their tax-exempt employment income, enter “0”.

If you did elect to provide CPP/QPP coverage, enter the amount of pensionable earnings on which you calculated the CPP/QPP contributions, up to a maximum of $48,300 for 2011.

Box 28 - Exempt (CPP/QPP, EI, and PPIP)

Do not complete the CPP/QPP part of this box if you entered an amount greater than 0 in box 16, 17, or 26. Enter an “X” under CPP/QPP only if the earnings were exempt for the entire period of employment.

Box 44 - Union dues

Leave this box blank. Union dues paid in respect of tax-exempt employment income are not deductible by the Indian employee.

Box 52 - Pension adjustment

Tax-exempt salary is included when determining the pension adjustment amount. See Box 52 for details.

Box 55 - Employee's PPIP premiums

Tax-exempt salary or wages paid to an Indian in Quebec are insurable earnings subject to PPIP premiums. Enter the PPIP premiums you deducted from employees working in Quebec.

Box 56 - PPIP insurable earnings

For employees working in Quebec, enter the total amount used to calculate the employee's PPIP premiums, up to a maximum of $64,000 for 2011.

Partly tax-exempt salary and wages

How to complete the T4 slip

Prepare the T4 slip in the following way when you pay a partly tax-exempt salary to an Indian.

Box 14 - Employment income

Enter the taxable salary or wages paid to the Indian employee in box 14. In the “Other information” area, enter code 71 and the amount of the tax-exempt salary or wages paid in the year.

Boxes 16 and 17 - Employee's CPP/QPP contributions

If you did not elect to provide CPP/QPP coverage to all your Indian employees on their tax-exempt employment income, enter the CPP/QPP contributions you deducted from the employee’s taxable earnings.

If you did elect to provide CPP/QPP coverage, enter the CPP/QPP contributions you deducted from the employee’s earnings.

Box 18 - Employee's EI premiums

Taxable and tax-exempt salary or wages paid to an Indian are insurable earnings subject to EI premiums. Enter the EI premiums you deducted.

Box 20 - RPP contributions

Registered pension plan (RPP) contributions that have been made for tax-exempt income are not deductible. Do not enter those contributions in box 20. If the employment income that relates to an RPP contribution consists of both taxable and tax-exempt income, you have to prorate the RPP contribution.

You do not have to prorate the amount of pension adjustment (PA). Report the total amount in box 52, "Pension adjustment," of the T4 slip.

Box 24 - EI insurable earnings

Enter the amount of insurable earnings on which you calculated the EI premiums, up to a maximum of $44,200 for 2011. Enter “0” if there are no insurable earnings..

Box 26 - CPP/QPP pensionable earnings

Enter the amount of pensionable earnings on which you calculated the CPP/QPP contributions, up to a maximum of $48,300 for 2011. Enter “0” if there are no pensionable earnings.

Box 44 - Union dues

Annual union, professional, or like dues related to tax-exempt income are not deductible. Do not enter these dues in box 44. If the employment income that relates to union dues consists of both taxable and tax-exempt income, you have to prorate the union dues.

Box 52 - Pension adjustment

Taxable and tax-exempt salary is included when determining the pension adjustment amount. See box 52 for details.

Box 55 - Employee's PPIP premiums

Taxable and tax-exempt salary or wages paid to an Indian in Quebec are insurable earnings subject to PPIP premiums. Enter the PPIP premiums you deducted from employees working in Quebec.

Box 56 - PPIP insurable earnings

For employees working in Quebec, enter the total amount used to calculate the employee’s PPIP premiums, up to a maximum of $64,000 for 2011.

Placement or employment agency workers

These guidelines apply to employees/workers engaged by placement or employment agencies, in the following four situations:

• agency that hires the employee;
• agency that pays the worker;
• agency whose client pays the worker; or
• agency that hires a worker under a contract for service.

Agency that hires the employee

An agency that hires an employee (even if he or she is located at a client's premises) has to deduct CPP/QPP contributions, EI premiums, income tax, and PPIP premiums (for workers in Quebec) from amounts paid to these employees. The agency also has to report these amounts on a T4 slip for the employee.

Agency that pays the worker

If an agency places a worker in employment under the direction and control of a client of the agency and the agency pays the worker, the agency is not required to deduct income tax, but is required to deduct CPP/QPP contributions, EI premiums, and PPIP premiums (for workers in Quebec), from amounts paid to these workers. The agency also has to report these amounts on a T4 slip for the worker.

Agency whose client pays the worker

If an agency places a worker in employment under the direction and control of a client of the agency and the client of the agency pays the worker, the client is required to deduct CPP/QPP contributions and income tax but is not required to deduct EI premiums or PPIP premiums (for employees in Quebec). The client of the agency has to report these amounts on a T4 slip.

Agency that hires a worker under a contract for service

An agency that hires a worker under a contract for service (that is, an independent worker) is not required to deduct CPP/QPP contributions, EI premiums, PPIP premiums, or income tax since the worker is self employed. Because the worker is self-employed, neither the agency nor the client is required to file a T4 slip. However, you may be required to file a T4A slip. See Guide RC4157, Deducting Income Tax on Pension, and Other Income and Filing the T4A Slip and Summary.

How to complete the T4 slip

In all cases, except where an agency hires a worker under a contract for service, you complete the T4 slip as follows:

Employer's name

Enter your operating or trade name.

Employee's name and address

Enter the employee's/worker's name and address, including the province or territory and postal code.

Box 10 - Province of employment

Enter the provincial or territorial abbreviation to show where the employee/worker reported to work (see the list under Box 10 - Province of employment).

Box 12 - Social insurance number

Enter the social insurance number (SIN) shown on the employee's/worker's SIN card.

Box 14 - Employment income

Report the gross earnings before deductions only if the agency hired the employee. If the agency paid the worker or the agency’s client paid the worker, leave this box blank. See Code 81.

Boxes 16 and 17 - Employee’s CPP/QPP contributions

Enter the CPP/QPP contributions you deducted from the employee’s/worker’s gross earnings.

Box 18 - Employee's EI premiums

Enter the EI premiums you deducted from the employee’s/worker’s gross earnings. If the agency’s client paid the worker, leave this box blank.

Box 22 - Income tax deducted

Enter the total income tax you deducted from the employee’s/worker’s remuneration. This includes the federal, provincial (except Quebec), and territorial taxes that apply. If the agency paid the worker, leave this box blank.

Box 24 - EI insurable earnings

Enter the amount of the employee’s/worker’s insurable earnings on which you calculated the EI premiums, up to a maximum of $44,200 for 2011. Enter “0” if there are no insurable earnings. If the agency’s client paid the worker, enter “0”.

Box 26 - CPP/QPP pensionable earnings

Enter the amount of the employee’s/worker’s pensionable earnings on which you calculated the CPP/QPP contributions, up to a maximum of $48,300 for 2011. Enter “0” if there are no pensionable earnings.

Box 29 - Employment code

Enter employment code 11. If the agency hired the employee, leave this box blank.

Box 55 - Employee's PPIP premiums

Enter the PPIP premiums you deducted from the employee’s/worker’s gross earnings while he or she worked in Quebec. If the agency’s client paid the worker, leave this box blank.

Box 56 - PPIP insurable earnings

For employees/workers working in Quebec, enter the total amount used to calculate the employee’s/worker’s PPIP premiums, up to a maximum of $64,000 for 2011. If the agency’s client paid the worker, leave this box blank.

Code 81

In the "Other information" area at the bottom of the T4 slip, use code 81 and enter the gross earnings of placement and employment agency workers. If the agency hired the employee, leave this box blank.

Retiring allowances

As of 2011 (for the 2010 tax year) retiring allowances are reported on the T4 slip instead of the T4A slip.

A retiring allowance (also called severance pay) is an amount paid to officers or employees when or after they retire from an office or employment, in recognition of long service or for the loss of office or employment.

A retiring allowance includes:

• payments for unused sick leave credits on termination; and
• amounts individuals receive when their office or employment is terminated, even if the amount is for damages (such as wrongful dismissal) when the employee does not return to work.

A retiring allowance does not include:

• a superannuation or pension benefit;
• an amount an individual receives as a result of an employee’s death (these payments may be treated as death benefits);
• a benefit derived from certain counselling services;
• payments for accumulated vacation leave not taken prior to retirement;
• wages in lieu of termination notice (see Guide T4001, Employers’ Guide - Payroll Deductions and Remittances); and
• damages for violations or alleged violations of an employee’s human rights awarded under human rights legislation to the extent these amounts are not taxable.

If you pay a retiring allowance to a resident of Canada, deduct income tax from any part you pay directly to the recipient. Combine all retiring allowance payments that have been or are expected to be paid in the calendar year when determining the composite rate to use. Use the following lump sum withholding rates to deduct income tax:

• 10% (5% for Quebec) on amounts up to and including $5,000;
• 20% (10% for Quebec) on amounts over $5,000 up to and including $15,000; and
• 30% (15% for Quebec) on amounts over $15,000.

Recipients may have to pay additional tax on these amounts when they file their returns. To avoid this situation, if a recipient requests it, you can:

• calculate the annual tax to deduct from the recipient’s yearly remuneration, including the lump-sum payment. You can use the Payroll Deductions Online Calculator (PDOC);
• calculate the annual tax to deduct from the recipient’s yearly remuneration, not including the lump-sum payment; and
• subtract the second amount from the first amount.

The result is the amount you deduct from the lump-sum payment if the recipient requests it.

Do not deduct income tax from a lump-sum payment if a recipient’s total earnings received or receivable during the calendar year, including the lump-sum payment, are less than the “claim amount” on their Form TD1, Personal Tax Credits Return. This does not apply to lump-sum payments paid to non-residents.

Do not deduct CPP contributions or EI premiums from retiring allowances.

If you pay a retiring allowance to a non-resident of Canada, you have to withhold 25% of the retiring allowance (subject to various tax conventions and agreements). Send this amount to the Receiver General on the non-resident’s behalf. For more information, see Guide T4061, NR4 - Non-Resident Tax Withholding, Remitting and Reporting.

Transfer of a retiring allowance

Employees with years of service before 1996 may be able to directly transfer all or part of a retiring allowance to a registered pension plan (RPP) or a registered retirement savings plan (RRSP). This part is commonly referred to as the eligible portion or the amount eligible for transfer. A retiring allowance may include an eligible portion and a non-eligible portion.

A retiring allowance may be paid over one or more years. The amounts paid in any particular year may be transferred to an RRSP or an RPP. The amounts transferred cannot exceed the employee’s eligible portion of the retiring allowance minus the eligible portion transferred by you in a prior year.

The amount that is eligible for transfer under paragraph 60(j.1) of the Income Tax Act (the Act) is limited to:

• $2,000 for each year or part of a year before 1996 that the employee or former employee worked for you (or a person related to you); plus
• $1,500 for each year or part of a year before 1989 of that employment in which none of your contributions to the RPP or deferred profit sharing plan (DPSP) were vested in the employee’s name when you paid the retiring allowance. To determine the equivalent number of years of vesting, refer to the terms of the particular plan. The number can be a fraction.

You can only transfer the eligible portion of the retiring allowance under paragraph 60(j.1) of the Act to the employee’s own RRSP or to an RPP under which your employee is the annuitant. The eligible portion cannot be directly transferred to a spousal or common-law partner’s RRSP under paragraph 60(j.1) of the Act. If you transfer the amount to an RPP, you may have to report a pension adjustment (PA). For more information, contact your plan administrator.

Your employee may choose not to use all or any portion of the amount eligible for transfer under paragraph 60(j.1) of the Act. If your employee has available RRSP deduction limit, your employee may transfer some or all of the retiring allowance to a spousal or common-law partner RRSP up to his or her RRSP deduction limit.

Your employee may also ask you to transfer some or all of the non-eligible portion of the retiring allowance to his or her RRSP, or to a spousal or common-law partner’s RRSP. The non-eligible portion of a retiring allowance is the amount that exceeds the amount eligible for direct transfer. The part that you transfer cannot be more than the employee’s available RRSP deduction limit for the year.

You do not have to deduct income tax on the amount of eligible retiring allowance that is transferred directly to an employee’s RRSP or to an RPP on behalf of the employee. You also do not have to deduct income tax on any part of the retiring allowance that your employee transfers to a spousal or common-law partner’s RRSP if you have reasonable grounds to believe your employee can deduct the RRSP contribution when filing his or her personal income tax and benefit return. For more information, see the section called “RRSP contributions you withhold from remuneration” in Chapter 5 of Guide T4001, Employers’ Guide - Payroll Deductions and Remittances.

The portion of the retiring allowance paid in each year that is eligible for transfer should be reported in the “Other information” area, using code 66 (code 68 in the case of an Indian). Amounts not eligible for transfer are reported in the “Other information” area using code 67 (code 69 in the case of an Indian). For example, if an employee receives $60,000 payable in instalments of $10,000 over 6 years and has an eligible amount of $40,000, the employee can choose how they want the eligible and ineligible portions applied to the instalment payments in each year.

For more information about retiring allowances, see Interpretation Bulletin IT-337, Retiring Allowances, Pamphlet T4145, Electing Under Section 217 of the Income Tax Act and Guide T4061, NR4 - Non-Resident Tax Withholding, Remitting, and Reporting.

Salary deferral arrangements

A salary deferral arrangement is a plan or arrangement made between an employee and an employer. Under such an arrangement, an employee postpones receiving salary and wages to a later year. Treat the deferred salary and wages as employment income in the year the employee earns the amount. Report it on the employee's T4 slip for that year.

Prescribed plans or arrangements

Prescribed plans or arrangements described in advance income tax ruling ATR39, Deferred Salary Leave Plan (Archived), are not covered by the above salary-deferral rules. Treat the deferred amounts in these cases as income in the year the employee receives them. Report the income on the employee's T4 slip for that year.

To find out how to report pension adjustments under these circumstances, see Guide T4084, Pension Adjustment Guide.

Salary paid while the participant is working

How to complete the T4 slip

Prepare the T4 slip in the following way when you pay a salary to the participant while he or she is working.

Box 14 - Employment income

Enter the participant's net salary (the salary minus the deferred amounts) while the person was working.

Boxes 16 and 17 - Employee's CPP/QPP contributions

Enter the CPP/QPP contributions you deducted from the participant's net salary (the salary minus the deferred amounts) while the person was working.

Box 18 - Employee's EI premiums

Enter the EI premiums you deducted from the participant's gross salary (including deferred amounts) while the person was working.

Box 22 - Income tax deducted

Enter the total income tax you deducted from the participant's remuneration. This includes the federal, provincial (except Quebec), and territorial taxes that apply.

Box 24 - EI insurable earnings

Enter the amount of insurable earnings on which you calculated the participant’s EI premiums, up to a maximum of $44,200 for 2011. Enter “0” if there are no insurable earnings.

Box 26 - CPP/QPP pensionable earnings

Enter the amount of the participant’s pensionable earnings on which you calculated the CPP/QPP contributions, up to a maximum of $48,300 for 2011. Enter “0” if there are no pensionable earnings.

Box 28 - Exempt (CPP/QPP, EI, and PPIP)

Do not complete the CPP/QPP, EI, or PPIP part of this box, unless the earnings were exempt for the entire period of employment.

Box 55 - Employee's PPIP premiums

Enter the PPIP premiums you deducted from the participant's gross earnings (including deferred amounts) while the person was working in Quebec.

Box 56 - PPIP insurable earnings

For participants working in Quebec, enter the total amount used to calculate the participant's PPIP premiums, up to a maximum of $64,000 for 2011.

Deferred amounts paid to the participant during the leave period

How to complete the T4 slip

Prepare the T4 slip in the following way when you pay the deferred amounts to the participant during the leave period

Box 14 - Employment income

Enter the total deferred amounts paid to the participant during the leave period.

Boxes 16 and 17 - Employee's CPP/QPP contributions

Enter the CPP/QPP contributions you deducted from the participant's deferred amounts you paid during the leave period.

Box 18 - Employee's EI premiums

Leave this box blank.

Box 22 - Income tax deducted

Enter the total income tax you deducted from the participant's remuneration. This includes the federal, provincial (except Quebec), and territorial taxes that apply.

Box 24 - EI insurable earnings

Enter “0”.

Box 26 - CPP/QPP pensionable earnings

Enter the amount of the participant’s pensionable earnings on which you calculated the CPP/QPP contributions, up to a maximum of $48,300 for 2011. Enter “0” if there are no pensionable earnings.

Box 28 - Exempt (CPP/QPP, EI, and PPIP)

Enter an "X" under EI. Do not complete the CPP/QPP or PPIP part of this box, unless the earnings were exempt for the entire period of employment.

Box 55 - Employee's PPIP premiums

Leave this box blank.

Box 56 - PPIP insurable earnings

Leave this box blank.

Salary overpayments

If you make a payment or an overpayment of salary, wages or other remuneration to an employee, how you correct this will depend on the reason the employee was overpaid and the year in which the employee repaid the amount.

Note
If you allow your employee to repay the overpayment in instalments, you may have to calculate a taxable interest benefit. For further information, see “Loans - interest free and low-interest” in Guide T4130, Employers’ Guide - Taxable Benefits and Allowances.

Employee did not perform duties

When an employee repays you, in the same or a later year, for salary or wages received when the employee did not perform his or her duties, the repayment is considered to be a repayment of salary and wages. Examples include an employee who was advanced vacation leave credits, but quit working for you before actually earning the credits; or an employee who was paid a signing bonus but did not work for the time agreed to in the employment contract.

You cannot adjust the employee’s T4 slip or the payroll records to reduce the total employment income or source deductions by the amount of the repayment. Your employer’s share of CPP contributions and EI premiums is not refundable.

You should give the employee a letter confirming the tax year when the overpayment was included in the employee’s income as well as the date, the reason, and the amount of repayment you received. The employee may claim a deduction on his or her personal income tax and benefits return in the year the amount was repaid.

Example
In September 2011, Peter became ill and was unable to work. You continue to pay his regular salary. In February 2012, he begins to receive payments from a wage loss replacement plan and repays you the amount of salary he received from September 2011 to February 2012. Do not adjust his 2011 T4 slip to reduce the total employment income and CPP/QPP pensionable and EI or PPIP insurable earnings or the current year pay records to reflect the amount of repayment. Instead, Peter can claim a deduction for the repayment on his 2012 income tax and benefit return by providing a copy of the letter you gave him confirming the date and the amount he repaid to you and the year the amount was included in income.

Clerical or administrative errors

We will not consider an amount to be salary, wages, or an advance in the year the employee received it if the employee is overpaid because of an administration or clerical error (mistake). If you discover the error after issuing a T4 slip for the employee, you must issue an amended T4 slip for that year to exclude this amount.

However, the amount should be included on a T4 slip in the following situations:

• The employee says he or she will repay the amount and does not. Include the amount in employment income in the year the employee agrees to repay the amount but does not.
• The employee says he or she will not repay the amount. Include the amount in employment income in the year of the overpayment.
• The employer forgoes his or her right to the amount. Include the amount in employment income in the year of forgiveness.
• There was knowledge or collusion and the employee does not repay the amount. Include the amount in employment income in the year of the overpayment.

If the employee repays you in the same year as the overpayment, the employee may repay you the net amount (gross pay less source deductions) as long as you are able to reduce your next payroll remittance to the CRA by the CPP, EI or income tax remitted in error (including your share of CPP and EI) before your last remittance for the year has been made.

Your employee should repay you the gross amount of the salary overpayment if you did not withhold CPP, EI or income tax deductions when the amount was paid to the employee or you are not able to reduce your next payroll remittance to the CRA for that year. Your employee should also repay you the gross amount if the salary paid in error and the repayment are in a different tax year. In these situations, you will have to include the deductions on the employee’s original (or amended) T4 slip, but you should reduce the employee’s total income, and the CPP pensionable and EI insurable earnings by the amount of the salary repayment.

If you had to report the CPP and EI deductions withheld in error on the employee’s T4 slip, you can ask for a refund of the employer’s share of CPP contributions or EI premiums that you deducted in error by completing Form PD24, Application for a Refund of Overdeducted CPP Contributions and/or EI Premiums. You can request a refund up to four years after the end of the year in which the CPP overpayment occurred, or three years in the case of an EI overpayment.

Seasonal Agricultural Workers Program

If you employ foreign workers under the Seasonal Agricultural Workers Program, enter code 15 in box 29, "Employment code," of the T4 slips for your employees. For information, see Guide RC4004, Seasonal Agricultural Workers Program.

For more information

What if you need help?

If you need help after reading this guide, go to Payroll or call 1-800-959-5525.

Forms and publications

To get our forms or publications, go to Forms and publications or call 1-800-959-2221.

Electronic mailing lists

We can notify you immediately about new information on payroll, electronic filing for businesses, and more. To subscribe, free of charge, go to Electronic mailing lists.

Teletypewriter (TTY) users

TTY users can call 1-800-665-0354 for bilingual assistance during regular business hours.

My Business Account

My Business Account is a secure and convenient way to access and manage your business accounts online.

You can view your account balance and transactions, file your return and view its status, view address, view remitting requirements, provide a nil remittance, and request to close your payroll account. For more information, go to My Business Account.

Electronic payments

Make your payment online using the CRA’s My Payment service or using your financial institution’s telephone/Internet banking services. For more information, go to Electronic payments, or contact your financial institution.

Addresses

Ottawa Technology Centre

Canada Revenue Agency
875 Heron Road
Ottawa ON K1A 1G9

Electronic Media Processing Unit

Ottawa Technology Centre
Canada Revenue Agency
875 Heron Road
Ottawa ON  K1A 1A2

Tax Centres

Jonquière Tax Centre
2251 René-Lévesque Boulevard
Jonquière QC G7S 5J1

Shawinigan-Sud Tax Centre
Post Office Box 3000
Station Bureau-chef
Shawinigan QC G9N 7S6

St. John's Tax Centre
290 Empire Avenue
St. John's NL A1B 3Z1

Sudbury Tax Centre
1050 Notre Dame Avenue
Sudbury ON P3A 5C1

Summerside Tax Centre
275 Pope Road
Summerside PE C1N 6A2

Surrey Tax Centre
9755 King George Boulevard
Surrey BC V3T 5E1

Winnipeg Tax Centre
66 Stapon Road
Winnipeg MB R3C 3M2

Publications for employers

• Employers’ Guide - Payroll Deductions and Remittances (T4001)
• Employers’ Guide - Taxable Benefits and Allowances (T4130)
• Deducting Income Tax on Pension and Other Income, and Filing the T4A Slip and Summary (RC4157)
• Fishers and Employment Insurance (T4005)

Our service complaint process

If you are not satisfied with the service you have received, contact the CRA office you have been dealing with. If the matter is not resolved, you can choose to file a service complaint. If you are not pleased with the way the CRA handles your complaint, you can contact the Office of the Taxpayer’s Ombudsman. For more information, go to Service Complaints or see Booklet RC4420, Information on CRA - Service Complaints.

Your opinion counts

If you have any comments or suggestions that could help us improve our publications, we would like to hear from you. Please send your comments to:

Taxpayer Services Directorate
Canada Revenue Agency
750 Heron Road
Ottawa ON  K1A 0L5