Payments to emergency services volunteers

You (as a government, municipality, or public authority) may pay an individual who performs the duties of certain emergency services workers on a volunteer basis (an emergency service volunteer). An individual cannot be considered a volunteer if, in the same year, they were employed by the same public authority to perform the same or similar duties as the volunteer activities.

Depending on the situation, the individual may qualify for an exemption of up to $1,000 from the amounts you paid them, provided all applicable conditions are met.

On this page

• Steps
• References

Steps

1. Determine if you need to report the amounts paid on a T4 slip

   Generally, you (as a government, municipality, or public authority) must report amounts you paid to an emergency service volunteer on a T4 slip.

   Under the Canada Revenue Agency (CRA) administrative policy, you must report the amounts paid on a T4 slip if one of the following applies:

   • You deducted Canada Pension Plan (CPP), employment insurance (EI) premiums, or income tax from the amount paid.
   • The total of all amounts paid in the calendar year weas more than $500.

2. Determine if the individual qualifies for the exemption

   Under the Income Tax Act, if you pay an individual who performs the duties of certain emergency services workers on a volunteer basis, the individual may be eligible for an exemption of up to $1,000 of amounts paid if all of the following conditions are met:

   • You are a government, municipality, or public authority.

   • You pay the individual to perform, as a volunteer, the duties of:

     • A firefighter
     • An ambulance technician
     • An emergency service volunteer who assists in the search or rescue of individuals, or in other emergency situations and disasters
   • You did not employ (or otherwise engage) the individual during the year to provide the same or similar duties (for example, a full-time firefighter who, from time to time, performs the duties of a volunteer firefighter or rescue worker for you).
   • You paid the individual a nominal amount to perform these duties compared with what it would have cost in the same circumstances to have the same duties performed by a regular full-time or part-time employee.

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   •  If all of the conditions above are not met, the individual does not qualify for the $1,000 exemption.

   •  If all of the conditions above are met, the individual qualifies for the exemption of up to $1,000.

3. Determine if the amounts paid are pensionable and insurable

   The amounts paid to an individual who performs the duties of certain emergency services workers on a volunteer basis are pensionable and insurable if all of the following apply:

   • The individual receives an hourly wage, salary, or other fixed amount of remuneration.
   • The individual adheres to a regular work schedule.
   • The individual is available and obligated to intervene when an emergency (such as a fire) occurs during the schedule you (as the employer) set. However, if they must be available during the fixed work schedule, but are not obligated to intervene when the emergency occurs, the amounts paid are not pensionable or insurable.

   Learn more if you are unsure whether the individual is a regular employee or a volunteer: CPP/EI explained, Rescue operations-Abating a disaster

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   •  If the emergency services volunteer does not meet all of the conditions above, the employment is not pensionable or insurable.

   • If the emergency services volunteer meets all of the conditions above, the employment is pensionable and insurable.

4. Determine which deductions you need to withhold from the amounts paid

   If you pay an individual who performs the duties of certain emergency services workers on a volunteer basis, you must withhold the following deductions:

   • Income tax

     Withhold income tax depending on whether the individual qualifies for the exemption (Step 2):

     • Exemption applies

       Only withhold income tax on amounts paid over $1,000

     • No exemption

       Withhold income tax on all amounts paid

   • CPP contributions

     Withhold CPP contributions depending on whether the individual qualifies for the exemption (Step 2) and whether the income is pensionable (Step 3):

     • Pensionable and exemption applies

       Only withhold CPP contributions on amounts paid over $1,000

     • Pensionable and no exemption

       Withhold CPP contributions on all amounts paid

     • Not pensionable

       Do not withhold CPP contributions from the amounts paid

   • EI premiums

     Withhold EI premiums depending on whether the income is insurable (step 3):

     • Insurable

       Withhold EI premiums on all amounts paid

     • Not insurable

       Do not withhold EI premiums on the amounts paid

    Learn more on how to calculate: How to calculate

5. Report the amounts paid on a T4 slip

   If you pay an individual who performs the duties of certain emergency services workers on a volunteer basis, you must report the following amounts on a T4 slip depending on whether the individual qualifies for the exemption (Step 2):

   • Exemption applies

     • Box 14 - Employment Income (amounts paid over $1,000)
     • Box 24 - EI insurable earnings
     • Box 26 - CPP/QPP pensionable earnings (pensionable earnings and amounts paid over $1,000)
     • Code 87 (tax-exempt amounts paid up to $1,000)

   • No exemption

     • Box 14 - Employment Income
     • Box 24 - EI insurable earnings
     • Box 26 - CPP/QPP pensionable earnings

    Learn how to report the amount paid: T4 slip - Information for employers

References

Legislation