Where an employer offers, free of charge, to all its employees, a party or other social event whose cost per person does not exceed $150, is the $150 per person cost calculated for determining whether there is a taxable benefit computed based on the total number of people who were invited or instead on the total number attending? If the cost exceeds $150 per person, is the resulting taxable benefit to those invited or only those attending? CRA responded by first referring to the statement in the T4130 Employers’ Guide that:
“If you provide a free party or other social event to all your employees and the cost is $150 per person or less, we do not consider it to be a taxable benefit. … If the cost of the party is greater than $150 per person, the entire amount, including the additional costs, is a taxable benefit.”
CRA then stated:
[T]he "per person" cost of $150 for this position is based on the total number of people attending the party or social event. …
[A] person who is invited to a party or a social event but who does not attend has not received or enjoyed a benefit.