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When giving a gift to an employee...

By Julia Germain |

Carrie asked:

We own a mechanic shop.  We have a parts Manager.  We would like to buy him a trip voucher, for a vacation of his choice.  But we do not want him to end up paying taxes on it.  Is there a way we can do this?

Julia Germain answered:

To answer your question, we contacted Julia Germain of Ask The Accountant.

Julia explained that the answer is that technically no, there is no way to provide this type of benefit to your employee without it being a taxable benefit, on which taxes are owed. (There are a few exceptions.)

There are a few allowable exceptions, like valid employment expenses and travel is sometimes included, but the employee needs to be travelling for business reasons. 

Here is a link to the CRA document that explains this briefly:

And here is a more in-depth CRA guide on this topic. I would suggest that you review the section on travel expenses for business.

The benefits chart in this guide is also very helpful:

Sorry we could not provide the answer you were hoping for.

CanadaOne (CO) Staff

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