This letter to treasurers includes:
- reminder to keep GSI informed
- taxable benefit rates
- new life and disability bundle rate
- housing allowance information for the T4
- reminder to check eligibility of part time employees
Treasurers’ Year-end Update and Reminders
The following are important reminders for you in your role as treasurer. All of the information provided here is on our website. Please refer to the website regularly as you complete your treasurer duties.
Please keep us informed
It is very important that you communicate all your personnel decisions and changes to GSI on a timely basis to ensure continuous and accurate coverage for your employees and compliance with policy contracts and legislation. It may be prudent to consult with GSI prior to finalizing decisions to avoid expensive mistakes or undue risks of liability.
Taxable Benefits
The following premiums paid by the employer are a taxable benefit to the employee. Please include these amounts in the monthly income used to calculate income tax with-holdings. A working paper to assist in making the calculation is provided on our website, see the forms & worksheets tab. Please note that provincial sales tax may apply.
|
2018 |
2017 |
|
| Basic Life Rate – new! |
0.239 |
0.260 |
| Dependent Life Rate |
4.86 |
4.86 |
| Accidental death and dismemberment |
0.38 |
0.38 |
Rates for 2018
| Description |
2018 |
2017 |
|
Required pension contributions Note: members may contribute up to an additional 3% on a voluntary basis |
Member 7% Employer 8% |
Member 7% Employer 8% |
|
Premium for life, disability, AD&D, parental leave supplemental pay and short-term counselling Note: this premium is increasing to cover the new benefits: short-term disability and parental leave supplemental pay. GSI will be increasing the premium gradually over the next several years to the target of 4.5%. |
Employer 3.5% |
Employer 3.25% |
| Premium for dental & extended health | Various by jurisdiction – please refer to the chart on our website | |
Reporting Housing Allowance
GSI has researched how to report a cash housing allowance on the T4 slip and the resulting consequence to the clergy residence deduction. This research included engaging PriceWaterhouseCoopers (PWC) to review the specific ELCIC situation and provide an opinion.
Over the past couple of years several pastors, their financial advisors and congregational treasurers have weighed in on whether or not to report the cash housing allowance in Box 30, each with persuasive arguments one way or another. While GSI and PWC see some rationale for including the amount in box 30, we concede that it remains a grey area.
However, whether or not the amount is in box 30, PWC’s reading of the Income Tax Act indicates clearly that the amount paid for housing allowance is not relevant to the calculation for the clergy residence deduction.
If the pastor owns or rents the home they live in, then the clergy residence deduction has an upper limit of one-third of their employment income.
GSI recommends not including the housing allowance in box 30 as it may be confusing when calculating the clergy residence deduction.
Member Eligibility
Please be aware that eligibility for the group pension and benefits plans is based on an earnings test relative to the year’s maximum pensionable earnings (YMPE) as set in relation to the Canada Pension Plan. The 2018 amount will be posted on the website once the 2018 YMPE is announced. It is the treasurer’s responsibility to report new hires or changes in salary to GSI to ensure that we are all in compliance with the contract and legislated requirements. Note that non-rostered employees must also meet an hours worked test for the group benefits, but no hours test is required for the pension plan.
Employee Terminations
Please remember the importance of notifying GSI when terminating employees in order to process a correct final invoice and so that GSI can advise plan members of their pension and benefits options on a timely basis. This is very important as options may expire and create a liability to the former employer. Also, we remind you that benefits cannot be extended during a severance period beyond the statutory limit (check your jurisdictions labour law). A paid leave of absence must have a pre-determined return to work date for the extension of benefits during the leave; otherwise it will be deemed a termination for benefit purposes.