Regarding enrollment in the redesigned benefits plan, what happens in a shared ministry situation where one Pastor is the minister of two congregations?
While we need to review each situation on a case by case basis, typically one congregation has the responsibility for payroll and then invoices the other congregation(s) for their portion based on the sharing agreement. Once the redesign is implemented, sharing agreements will have to address the sharing of the cost of the Green or Teal module.
The spouse of our Pastor is also a Pastor in the ELCIC. The way the plan redesign reads is that one Pastor cannot opt out. Can you confirm this is the case please? It doesn’t make sense for a two Pastor family to have to each take a minimum package when one of them can have benefits for the family.
GSI is required to administer the plan in accordance with the insurance contract. This contract requires that there be no provision to waive coverage when the employer pays the premium as is the requirement in the National Compensation Guideline. The Guideline has been in place for a couple of years now and GSI is giving notice of this change to coincide with the redesign. Whether or not a redesign of the benefits was undertaken, the removal of the waiver must be implemented.
Most of the feedback that GSI received on the first version of the redesign was a deep concern for wanting the benefit costs to be shared equally. The concept is that ELCIC congregations and institutions share in the support for the health and wellness of all of those serving by providing a minimum level of benefits to all employees who meet the eligibility requirements.
Under the redesign, employers must at least provide eligible employees with the Blue module of the health and dental plan and an employee meeting eligibility cannot opt out. The Green and Teal modules may be selected by the employee with the premium difference paid either by the employee, the employer congregation or a combination of both.
If there is a spouse who is also employed within the ELCIC, then both employees must enroll in family coverage. With both spouses enrolled there will be more benefits available; in effect the coverage increases through co-ordination. For example, when one spouse makes a claim for the services of a chiropractor and pays the co-insurance or the claim exceeds a maximum, then the spouse’s account can pay towards the difference. In this way a working couple of the ELCIC will not be treated any differently than any working couple that does not work within an affiliated group.
With the design of the new modules, GSI is striving to address both the cost concerns of the congregations and the sustainability of the benefits plan.
How much revenue can a congregation receive that is not cash donations (receipted), such as rent or interest?
All expenditures that the church makes must be for charitable activities and tie back to the purpose in the articles of incorporation or the church’s mission as described in Section C of the T3010. If this is the case then it is allowable to have rental or interest income. Please make sure the church is using that rental or interest income for charitable activity and that it is clearly documented in the church’s financial statements and/or minutes and/or policies.
Does payment to an organist (or similar positions) require reporting on a T4 or a T4A?
This is a question of whether the organist is an employee needing a T4 or whether the organist is providing a ‘fee for service’ requiring a T4A.
The congregation may need to apply some judgement to determine a ‘reasonable’ perspective. For instance if the services are very casual i.e. now and then and the total payments are under $1,000 then this looks more like fees for services. If the activity is regularly scheduled on the majority of Sundays and the total payments in the year start to climb higher than $1,000 then it appears that the person is an employee and a T4 should be issued.
Also note: CRA had been reviewing their definition of ‘fee for service’ and had stated that penalties would not be levied for failing to complete a box 048 fee for service on the T4A. This however does not mean that a T4A should not be issued at all. It means that the T4A should be continued to be issued with box 028 other income completed for this amount, if there is uncertainty between the two boxes.
Traditionally our congregation has collected cash from parishioners for a Christmas gift for the pastor. Is this a gift between individuals or does this constitute a taxable bonus?
Although it could be viewed as a gift of after tax money by a group of individuals to the pastor, completely separate and apart from the church (i.e. the employer), paragraph 6(1)(a) of the Income Tax Act is very broad in terms of what benefits should be included in employment income. Paraphrasing the actual legislation, it generally requires that the value of benefits of any kind whatever received or enjoyed in the year in respect of, in the course of, or by virtue of an individual’s employment must be included in the individual’s income.
It appears, therefore, that CRA’s view would be that the amount of the gift should be included in the pastor’s income.
Where there is no parsonage in a rural community and the Pastor chooses to live in a neighbouring community, who is responsible for travel expenses (Pastor or congregation) for travel to the office in the church or to the church for worship services?
to a second congregations in the Parish, for regular council, bible study or worship services etc.?
- Typical everyday travel to and from your place of work is a cost to the employee.
- Tax free mileage is paid when the employee is expected to travel from the workplace to an outside meeting or event.
Consider choosing the location where the majority of the responsibilities are as the ‘official’ work place and travel from there to the second location work be work paid travel.