Injury-on-Duty Leave -Amendment of T4 and/or Relevé 1
To: Heads of Compensation
The purpose of this bulletin is to advise departments of the process to obtain an amended T4 and/or Relevé 1 (for Québec residents) for employees on leave with pay due to an injury in the workplace. This process does not apply to employees who receive benefits directly from provincial Workers’ Compensation Board(s) (WCB) while on leave without pay for injury in the workplace.
Since January 2003, departmental Corporate Compensation Managers have been responsible for authorizing Public Works and Government Services Canada (PWGSC) to produce an employee’s amended T4 and/or Relevé 1, as a result of leave with pay for injury in the workplace.
The following information will assist Corporate Compensation Managers in dealing with the provincial WCBs and PWGSC.
Under some provincial WCB legislation, an employee on leave with pay, as a result of an injury on duty, is entitled to receive a tax credit equal to the amount the employee would have received had the provincial WCB paid the claimant directly.
Each provincial WCB is responsible for the issuance of a T5007 or a Relevé 5 (from Québec’s "Commission de la santé et sécurité au travail" (CSST)) to the employee for income tax purposes. The provincial WCB and the CSST also provide to the employer the value of the benefit (deemed value of lost wages) paid during the year for reporting purposes on the employee’s T4 and/or Relevé 1.
PWGSC will report the amount in box 77 of the T4. As of tax year 2008, Revenu Québec no longer allows for a deduction in cases where an employee continues to be paid before or after the decision of the CSST. As a result, for the Relevé 1, PWGSC will no longer deduct the amount from box A, but will provide the amount of the indemnity as a footnote for the year in which the benefits are applicable.
Federal tax regulations require the employer to report income in the year it was paid. In the case of an employee on leave with pay because of an injury on duty, the award (deemed value of lost wages) is to be treated for income tax purposes as if the payment were made in the year approved by the provincial WCB.
Each year the employer receives provincial WCB data files. These files contain information on:
- Employees on leave with pay who received benefits (deemed value of lost wages) during the previous calendar year, and
- Employees whose claims were filed in a previous year and decisions were only rendered by WCB in the current tax-filing year.
The amount reported for the latter case will include the deemed value of lost wages up to the date of the decision in the current tax-filing year and any other amount paid during the current tax-filing year. For example, the provincial WCB may render a decision in 2010 on a claim for an accident that occurred sometime prior to 2010. The value of the award covering the total period of absence will be reported on the 2010 T4.
The data file for employees covered by the CSST contains information on employees on leave with pay who received benefits (deemed value of lost wages) during the previous calendar years and reflects the calendar year in which the benefits are applicable.
At the beginning of each calendar year, TBS obtains data files of the deemed value of lost wages received for an injury on duty from the following provincial boards:
Nova Scotia, Québec, Ontario, Manitoba, Saskatchewan, Alberta, and British Colombia.
On receipt of the data files, the Compensation Management, Core Public Administration Section at TBS reviews and revises the formatting and forwards the data files to PWGSC for processing. The records on the data file are matched with the PWGSC pay master file to identify in which pay office and pay list the employee belongs.
When the process is completed, a report is produced for all the matched records and contains the employee’s Personal Record Identifier, Pay Office, Paylist and the amount to be reported in box 77 of the T4 and where applicable, the amount to be noted on the Relevé 1 for each year the benefits are applicable. These reports are then sent to the appropriate pay offices for input prior to the production of the T4 and/or Relevé 1. If PWGSC receives the data files after the annual production of the T4 and/or Relevé 1, the same process described above takes place except that PWGSC pay offices are instructed to produce an amended T4 and/or Relevé 1.
Requesting Amended T4 and/or Relevé 1
There are two situations where a department will have to investigate and take action. The first situation is where the amount of the provincial WCB benefits reported on the original or amended T4 or Relevé 1 is different from the amount of benefits the employee claims should have been reported. The second situation is where no amount was submitted to PWGSC for processing. For both situations, the Corporate Compensation Manager should contact the appropriate provincial WCB to obtain the correct amount to report on the T4 or Relevé 1.
Attached you will find a list of provincial WCB contacts who should be able to answer your enquiries.
It is preferable to forward your enquiries through e-mail. The phone numbers of the provincial WCB or CSST contacts are provided so that you can follow-up on your enquiries.
Because of privacy concerns, you should not include the Social Insurance Number in your e-mail request. You should always use the provincial WCB or CSST claim number. This number appears on the T5007 or Relevé 5 issued by the provincial WCB or CSST. If you do not have a copy of the employee’s T5007 or Relevé 5, you should obtain one from the employee. You should not use the amount reported on the employee’s T5007 or Relevé 5 because it may be different from the amount reported by the provincial WCB or CSST as lost wages while on leave with pay. The amount reported on the T5007 or Relevé 5 may include benefits paid directly from the provincial WCB or CSST to the employee.
The basic information in your e-mail should contain the name of the employee, the claim number, the year of the claim and the amount, if available. You should also provide your phone number in case the provincial WCB or CSST requires additional information. The provincial WCB or CSST will provide you with the amount of the deemed value of lost wages while on leave with pay and the calendar year in which the amount was approved (deemed to have been paid).
Once you have obtained the confirmation in writing from the provincial WCB or CSST, you should prepare a letter authorizing the pay office to amend the T4 and/or Relevé 1.
Departmental Compensation and Labour Relations managers should direct any questions that they may have to their appropriate corporate officials who may send their enquiries to the following e-mail address: Contact Interpretations by E-mail Interpretations@tbs-sct.gc.ca.
Core Public Administration
Compensation and Labour Relations
Office of the Chief Human Resources Officer
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