In 2023, the federal government committed budget to fully implement the Canadian Dental Care Plan (CDCP). The plan will provide dental coverage for uninsured Canadians with annual family income of less than $90,000, with no copays for those with family incomes under $70,000.
Read on to learn more about the new reporting requirements for the CDCP and changes to T4 and T4A tax slips, beginning for the 2023 tax year.
Canadian Dental Care Plan reporting requirements
The legislation requires the reporting of employer-provided dental coverage via T4 and T4A tax slips. This reporting requirement ensures that the new dental care plan is limited to Canadians with an unmet need for dental care who don’t have access to private insurance.
The legislation requires employers to report on a tax slip whether an employee, former employee, or a spouse of a deceased employee was eligible on December 31 of the reporting tax year to access dental insurance or dental coverage of any kind, due to current or former employment.
T4 and T4A tax slip updates for employer-offered dental benefits
This reporting requirement will be mandatory beginning with the 2023 tax year reporting cycle and will be required annually. As a result, the following new boxes will be added to the T4 and T4A slips for the 2023 tax year along with specific codes.
NewT4 Box 45: Employer-Offered Dental Benefits
New T4A Box 015: Payer-Offered Dental Benefits
For the T4A, box 015 is mandatory if an amount is reported in box 016 (pension or superannuation). Otherwise, box 015 is optional.
No access to any dental care insurance, or coverage of dental services of any kind.
Access to any dental care insurance, or coverage of dental services of any kind for only the payee.
Access to any dental care insurance, or coverage of dental services of any kind for payee, spouse and dependants.
Access to any dental care insurance, or coverage of dental services of any kind for only the payee and their spouse.
Access to any dental care insurance, or coverage of dental services of any kind for only the payee and dependants.
Please note: The codes above aren’t dependent on whether the employee has chosen the coverage or not. The code should reflect the coverage available to the employee based on their group plan.
To support our clients during year-end and ensure compliance, Avanti is currently working on updates to include the new dental coverage reporting requirements. These changes will be available in the product in December as part of our annual year-end tax release. Stay tuned for more information!
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