I-3 - Taxation Act

Section 869.6 Disposition versions

2022-06-08

869.6. Despite subsection 1 of section 175.1 and section 869.4, an employer may deduct in computing its income for a taxation year an amount that it is required to contribute for the year to an employee life and health trust if the following conditions are met at the time that the contribution is made:

(a)  (subparagraph repealed);

(b)  the employer contributes to the trust in accordance with a contribution formula that does not provide for any variation in contributions determined by reference to the financial experience of the trust and either of the following conditions is met:

i.  if there is a collective agreement, the trust provides benefits under

(1)  the collective agreement, or

(2)  a participation agreement that provides for benefits that are essentially the same as those provided for under the collective agreement, or

ii.  if there is no collective agreement, the trust provides benefits in accordance with an arrangement that meets the following conditions:

(1)  the agreement provides for a legal requirement for each employer to participate under the terms and conditions that govern the trust,

(2)  under the agreement, there are a minimum of 50 beneficiaries under the trust who are employees of the participating employers in respect of the trust, and

(3)  under the agreement, each employee who is a beneficiary under the trust deals at arm’s length with each participating employer in respect of the trust; and

(c)  contributions that are to be made by each employer are determined, in whole or in part, by reference to the number of hours worked by individual employees of the employer or some other measure that is specific to each employee with respect to whom contributions are made to the trust.

2011, c. 6, s. 174; 2022, c. 23, s. 77.

2011-06-06

869.6. Despite subsection 1 of section 175.1 and section 869.4, an employer may deduct in computing its income for a taxation year an amount that it is required to contribute for the year to an employee life and health trust if the following conditions are met at the time that the contribution is made:

(a)  it is reasonable to expect that

i.  at no time in the year will more than 95% of the employees who are beneficiaries of the trust be employed by a single employer or by a related group of employers, and

ii.  at least 15 employers will contribute to the trust in respect of the year or at least 10% of the employees who are beneficiaries of the trust will be employed in the year by more than one participating employer;

(b)  employers contribute to the trust under a collective bargaining agreement and in accordance with a negotiated contribution formula that does not provide for any variation in contributions determined by reference to the financial experience of the trust; and

(c)  contributions that are to be made by each employer are determined, in whole or in part, by reference to the number of hours worked by individual employees of the employer or some other measure that is specific to each employee with respect to whom contributions are made to the trust.

For the purposes of subparagraph ii of subparagraph a of the first paragraph, all employers who are related to each other are deemed to be a single employer.

2011, c. 6, s. 174.