# Can I claim Group Insurance and LTD payments as medical expense?



## gibor365 (Apr 1, 2011)

We have at work employee benefit plan .
Employer, every paycheque, deduct $ for Group Insurance and LTD payments. Can I claim Group Insurance and LTD payments as medical expense? or it's somehow already included in T4?


----------



## gt_23 (Jan 18, 2014)

gibor said:


> We have at work employee benefit plan .
> Employer, every paycheque, deduct $ for Group Insurance and LTD payments. Can I claim Group Insurance and LTD payments as medical expense? or it's somehow already included in T4?


I've always wondered the exact same thing. Most employers don't give you the choice to opt-out, so it feels like something you should be allowed to deduct on your income taxes, like health insurance.

However, I think the logic goes something like this: benefits from LTD and other insurances are tax-fee, so you have to pay for the premiums in after-tax dollars and thus, can't deduct them. This is probably why employers don't give you the choice to opt-out, since the poor tax treatment means less people would opt-in if given the chance. Another example of the Gov't rigging the system for the insurance industry.


----------



## gibor365 (Apr 1, 2011)

I also always thought that you cannot...but today I found


> Employee-paid premiums to a private health services plan are considered qualifying medical expenses and can be claimed by the employee on his or her income tax and benefit return.


http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/hlth/prvt-eng.html

So, looks like you can... I have nothing in Box 85 on my T4 (as well as my wife)....


----------



## AltaRed (Jun 8, 2009)

It depends. Ask your employer if you can do so. I know the material and T4s from my former employer specifically say NOT to claim the employee's portion as a medical expense.


----------



## gibor365 (Apr 1, 2011)

AltaRed said:


> It depends. Ask your employer if you can do so. I know the material and T4s from my former employer specifically say NOT to claim the employee's portion as a medical expense.


I send email to HR .... will see what they answer... But in your case where on T4 it was specifically saying? (I have just boxes and numbers)


----------



## gt_23 (Jan 18, 2014)

gibor said:


> I also always thought that you cannot...but today I found
> http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/hlth/prvt-eng.html
> 
> So, looks like you can... I have nothing in Box 85 on my T4 (as well as my wife)....


Sorry, I might not have been clear, but medical insurance premiums deductions are allowed, while LTD insurance for instance, is not.


----------



## nobleea (Oct 11, 2013)

gt_23 said:


> Sorry, I might not have been clear, but medical insurance premiums deductions are allowed, while LTD insurance for instance, is not.


In the vast majority of cases, medical insurance premiums are paid by the employer, not the employee. Thus not deductible. If they were employee paid, then for sure, try to claim them. There's a min level of medical claims required before it all becomes deductible. I think it's $2300/yr or something similar.


----------



## gibor365 (Apr 1, 2011)

nobleea said:


> In the vast majority of cases, medical insurance premiums are paid by the employer, not the employee. Thus not deductible. If they were employee paid, then for sure, try to claim them. There's a min level of medical claims required before it all becomes deductible. I think it's $2300/yr or something similar.


In Sept 2012 our employer changed policy , as per HR email


> we will be implementing a flat premium sharing for health and dental benefits based on coverage status. The premium sharing charged to each employee per month


and I pay $1,800 per year (we also have other out-of-pocket cash and also I think my wife also pays premium for insurance), however, employer never mentioned that I can claim this premium....also I can see this premium only on pay-stubs , there is no any annual summary or in T4 ...


----------



## kcowan (Jul 1, 2010)

AltaRed said:


> It depends. Ask your employer if you can do so. I know the material and T4s from my former employer specifically say NOT to claim the employee's portion as a medical expense.


Yes it is only employee payments that qualify.


----------



## AltaRed (Jun 8, 2009)

kcowan said:


> Yes it is only employee payments that qualify.


I deleted my post that you quoted because my message may not be correct.


----------



## Toronto.gal (Jan 8, 2010)

nobleea said:


> In the *vast majority of cases, medical insurance premiums are paid by the employer*, not the employee.


Thanks to increased costs & other factors, gone are the days of non-contributory health plans, when employers paid the full premium, and when benefits had no out-of-pocket expenses, such as deductibles/coinsurance.


----------



## Toronto.gal (Jan 8, 2010)

gibor said:


> We have at work employee benefit plan .
> Employer, every paycheque, deduct $ for Group Insurance and LTD payments. Can I claim Group Insurance and LTD payments as medical expense? or it's somehow already included in T4?


Whatever premiums paid by your employer that are considered a taxable benefit to you, would appear on the T4.

Good reference here.
http://www.groupbenefits.ca/group_benefit_taxation.aspx


----------



## Numbersman61 (Jan 26, 2015)

kcowan said:


> Yes it is only employee payments that qualify.


Most employer group insurance plans require the employee to pay the premium for LTD since if the employee collects benefits for LTD, they are then received tax free. LTD premiums paid by an employee are not considered medical expenses for tax purposes.


----------



## Toronto.gal (Jan 8, 2010)

Numbersman61 said:


> Most employer group insurance plans require the employee to the premium for LTD since if the employee collects benefits for LTD, *they are then received tax free.*


To clarify, for the actual benefit to be non-taxable in the event of a claim, the premium must be 100% employee-paid.


----------



## kcowan (Jul 1, 2010)

> Premiums under Provincial Hospitalization and Medical Care Insurance Plans
> 
> ¶ 16. Where an employer pays all or a part of the premiums or contributions that an employee is otherwise required to pay to a provincial authority administering a provincial hospital insurance plan, a provincial medical care insurance plan, or both, the amount paid is a taxable benefit to the employee.
> 
> ¶ 17. Where an employer pays an amount to an employee in respect of the employee's premium under a provincial hospital or provincial medical care insurance plan, the amount paid is a taxable benefit to the employee.


These show up on my T4A every year.

Source


----------



## gibor365 (Apr 1, 2011)

From what i understand , it's optional for Employer to enter amount on Box 85 medical insurance premiums I paid.... so, can I just enter this amount on Box 85 when filling taxes (even though it's no appear on T4 I received)?


----------



## Numbersman61 (Jan 26, 2015)

gibor said:


> From what i understand , it's optional for Employer to enter amount on Box 85 medical insurance premiums I paid.... so, can I just enter this amount on Box 85 when filling taxes (even though it's no appear on T4 I received)?


You should check with your employer to see if the group insurance premiums you paid were for LTD coverage. If they were for LTD coverage, they are NOT medical expenses.


----------



## gibor365 (Apr 1, 2011)

Numbersman61 said:


> You should check with your employer to see if the group insurance premiums you paid were for LTD coverage. If they were for LTD coverage, they are NOT medical expenses.


On paystubs we have 2 separate entries: Group Insurance premium and LTD , I know that LTD cannot be claimed, but Insurance premium can.... The questions only what is meaning of "optional" regarding, can I just enter this amount on Box 85 when filling taxes (even though it's no appear on T4 I received)? box 85...


----------



## AltaRed (Jun 8, 2009)

gibor said:


> On paystubs we have 2 separate entries: Group Insurance premium and LTD , I know that LTD cannot be claimed, but Insurance premium can.... The questions only what is meaning of "optional" regarding, can I just enter this amount on Box 85 when filling taxes (even though it's no appear on T4 I received)? box 85...


Group life insurance premiums are not a deductible medical expense unless it is a special type of life insurance (that I have never heard of) for which the payouts are taxable (as compared to the usual standard term/whole life arrangements). Health insurance is a different matter. 

A word of caution: What is put on paystubs is often a matte of convenience by the payroll system than definititive in terms of tax deductibility. The only way to know for sure is to ask your HR/payroll department.


----------



## gibor365 (Apr 1, 2011)

AltaRed said:


> Group life insurance premiums are not a deductible medical expense unless it is a special type of life insurance (that I have never heard of) for which the payouts are taxable (as compared to the usual standard term/whole life arrangements). Health insurance is a different matter.
> 
> A word of caution: What is put on paystubs is often a matte of convenience by the payroll system than definititive in terms of tax deductibility. The only way to know for sure is to ask your HR/payroll department....


We got email back in 2012 saying


> Plan Design Change and Premium Sharing, please note that as per our records your coverage status is “Family” under the Manulife insurance plan. Thus, applicable premium is CAD XXX per month ... For a single employee being covered for Health and Dental, the flat single premium charge will be CAD xxx per month.
> 
> - If an employee’s dependents opt for Health and / or Dental, the flat couple (CAD xxx) or family (CAD xxx) premium charge per month will apply based on number of dependents


 So it's clearly Health insurance premium....

Yes, i sent email to HR, who forwarded it to another HR, who forwarded it to ADP .... but they are not in hurry to answer 

P.S. I talked to dozen employees and except 1 , no one was even aware about claiming it.... No wonder why it's not mandatory for employer ... it's good for CRA (more $ left there), good for employers and ADP (less hassle ), only bad for employees....but who cares?!


----------



## Toronto.gal (Jan 8, 2010)

^ Yes, it is clearly what is noted under P below, as 'Employee-paid premiums for private health services plans.'
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/330/llwbl-eng.html


----------



## gibor365 (Apr 1, 2011)

Toronto.gal said:


> ^ Yes, it is clearly what is noted under P below, as 'Employee-paid premiums for private health services plans.'
> http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/330/llwbl-eng.html


Just to clarify....is it true that if I enter amount into T4 box 85 OR claim it as medical expense -> in both cases it would appear on box 330?


----------



## Toronto.gal (Jan 8, 2010)

^ I thought you were the TurboTax expert, no? 

Enter where you're prompted to do so; line 330 is the description of box 85, so the amount gets transferred to line 330 of your form.

Note the maximum eligible expenses noted for 2014.

Btw, when your plan details changed, was there not an employee benefits meeting to discuss the changes? Even if there was not, I'm surprised that you would not have tried to find out on your own if such expenses were tax-deductible. :biggrin:


----------



## Guban (Jul 5, 2011)

gibor said:


> On paystubs we have 2 separate entries: Group Insurance premium and LTD , I know that LTD cannot be claimed, but Insurance premium can.... The questions only what is meaning of "optional" regarding, can I just enter this amount on Box 85 when filling taxes (even though it's no appear on T4 I received)? box 85...


Don't pretend it is box 85 when it doesn't appear there. If the government checks, this difference will show up.

Just put it in as a separate medical expense like prescriptions or glasses or ...


----------



## gibor365 (Apr 1, 2011)

T.gal , no , no any meetings or explanation, just email that they starting to charge us.

I sent follow up email to HR, they said that my question is still in investigation  , and added


> we are part of a group insurance plan and not private health insurance plan. Any contribution to private health plan would be reflected on a T4 but that is not the case in a group insurance plan.


I'm dazed abd confused  they can call this plan whatever they want.... the point is we pay every months premiums to have dental and medical benefits.... 
Or my premiums group insurance plan is not for box 85 (line 330)?


----------



## Toronto.gal (Jan 8, 2010)

^^ You're absolutely right Guban [although as long as expenses were eligible & entered once, I would not have been too concerned]. 

Gibor, the reason why box 85 is *'optional'* for employers, is probably due to admin./compliance issues.

Keep in mind the other eligible out-of-pocket health expenses [if you have any], but that in order to claim the credit, they must exceed a % of your income. 

Updated 03/2015:

'The caveat of claiming any medical expense is that the government automatically deducts the lesser of either $2,171 or three per cent of your net income from a person's total medical expenses. For some, that means the credit might be negligible or even nonexistent, but for others it's definitely worthwhile to make a claim.'

http://www.cbc.ca/news/business/taxes/medical-expenses-often-overlooked-as-tax-deductions-1.1144112


----------



## Toronto.gal (Jan 8, 2010)

Now I'm confused, too! If your employer's extended health care plan [intended to supplement OHIP], isn't private, what is it, public?

Employee premium contributions for health/dental benefits = eligible for tax-credit for employee.
Employer premium contribution for above = non-taxable to employee.

*Edit:*

*CRA definition* of premiums paid to private health services plans:

*1.* Contributions made by an employer to or under a private health services plan on behalf of an employee are excluded from the employee's income from an office or employment by virtue of subparagraph 6(1)(a)(i). On the other hand, *an amount paid by an employee as a premium, contribution or other consideration to a private health services plan qualifies as a medical expense for purposes of the medical expense tax credit* by virtue of paragraph 118.2(2)(q). 

*9.* Private health services plan premiums, contributions or other consideration paid for by the employer are not included as medical expenses of the employee under paragraph 118.2(2)(q) by virtue of paragraph 118.2(3)(b) and are not employee benefits (see 1 above). They are however, business outlays or expenses of the employer for purposes of paragraph 18(1)*(a). On the other hand, contributions or premiums qualify as medical expenses under paragraph 118.2(2)(q) where they are paid directly by the employee, or are paid by the employer out of deductions from the employee's pay. 

http://www.cra-arc.gc.ca/E/pub/tp/it339r2/it339r2-e.html*


----------



## gibor365 (Apr 1, 2011)

> Now I'm confused, too! If your employer's extended health care plan [intended to supplement OHIP], isn't private, what is it, public?


 This is exactly what I replied 
P.S. looks like all tose HR issues because we were bought by Indian company... even all our HR people are from there


----------

