Changes coming to T4/T4A reporting Requirements

Preparing annual T4s and T4As can be stressful for employers and to make the process as smooth as possible, there are some important changes for 2023 T4s and T4As that you should know about. 

In November of 2022, the first part of the Canadian Dental Care Plan was passed to help provide dental services to eligible children under the age of 12 and in 2023 the government announced plans to expand eligibility to more Canadians. As a result of these new benefits, the Dental Care Measures Act was passed in June 2023 which will require employers to disclose additional information on T4s and T4As regarding dental-related benefits provided to their current or former employees.

Employers are required to report on T4s and T4As whether employees and their families were eligible to access dental care insurance or dental coverage of any kind in 2023, including health spending accounts. This will be reported annually, starting 2023 filing year, on box 45 (Employer-offered dental benefits) for T4 slips and box 015 (Payer-offered dental benefits) for T4A slips.  Completion of T4A Box 015 will be mandatory in all cases where Box 016 is completed. Disclosure will continue annually and failure to report these amounts may result in financial penalties.

The box will be completed using one of five categories which will identify the coverage offered* to the employee and/or their immediate family. The five categories are as follows:

  • Code 1 – Not eligible to access any dental care insurance or coverage of dental services of any kind
  • Code 2 – Payee only
  • Code 3 – Payee, spouse and eligible children
  • Code 4 – Payee and their spouse
  • Code 5 – Payee and their dependent children

*It is important to know that the codes above are based on the level of dental coverage offered to the employee and not whether the employee used, enrolled, declined or took advantage of the coverage or service.

As with most administrative and reporting changes, there are many questions. Some commonly asked questions are as follows:

What if I filed my T4s or T4As already?

If a T4/T4A slip is filed before January 2024, employers and plan administrators are not required to amend the slips.

What if someone has quit, retired, or was terminated during the year?

Employees that are no longer employed on December 31 and no longer have access to dental coverage, select code 1.

What if my employee is on probation as of December 31?

New hires that are still on their probation period as of December 31 would not be eligible to participate in the dental coverage yet, therefore would be answered as code 1.

What if my employees are eligible for a health care spending account or a wellness spending account?

If the spending account is offered to the employee and the account is eligible for dental reimbursements, the use of code 1 will not be appropriate, even if the employee does not incur any dental reimbursements in the year.

Employers are encouraged to work closely with their payroll providers and to visit the CRA’s website for full details. If you have any other questions regarding these changes, please contact our office for trusted advice and personal service.

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