Principal Issues: Is a bonus taxable?
Position: Yes
Reasons: A bonus is employment income and taxable under section 5 of the Act.
February 19, 2010
XXXXXXXXXX
Dear XXXXXXXXXX :
The office of XXXXXXXXXX , forwarded to my predecessor, the Honourable Jean-Pierre Blackburn, a copy of your correspondence, which was received on December 18, 2009, concerning the taxation of employment bonuses. You refer to a recent article about bankers not having to pay tax on their bonuses. I cannot provide any meaningful comment on its content or accuracy because I do not have a copy of the article in question. I can confirm that under Canadian income tax law, a bonus paid to an employee working in any type of employment is taxable as employment income.
I appreciate the opportunity to address your concerns.
Yours sincerely,
Keith Ashfield
Minister of National Revenue
Renée Shields
613-957-2049
2009-035257