What is a T4E in Canada? (2024)

In Canada, a T4E tax slip is a crucial document you’ll come across during tax season.

It’s a statement of Employment Insurance (EI) benefits and other related payments you may have received during the tax year.

By understanding the importance of a T4E slip, you’ll be better equipped to manage your taxes.

If you’ve received Employment Insurance benefits or participated in an approved employment program, you’ll be issued a T4E slip. This document summarises the gross amount of benefits paid, any income tax deducted, and possible overpayment amounts. You’ll need to report these figures on your tax return.

What You need to Know About the T4E

The Purpose of a T4E

In Canada, the T4E tax slip is an essential document you need when filing your income tax return.

It is issued by Service Canada and notes the gross amount of Employment Insurance (EI) benefits you have received in the previous tax year, as well as any income tax deductions and repayments made towards overpayments.

As a recipient of EI benefits, you may have participated in an approved employment program funded by EI. In this case, your T4E will also report any financial assistance you have received during your participation in such programs.

If you are a resident of Quebec as of December 31, you will receive a T4E(Q) instead of a standard T4E. The T4E(Q) is essentially the same but includes an additional copy to attach to your provincial tax return.

Below are some key components you can expect to find on your T4E tax slip:

  • Gross amount of benefits paid
  • Income tax deducted
  • Amount paid towards an overpayment (if applicable)
  • EI-funded financial assistance received while participating in approved employment programs (if applicable)

Remember to report the information provided in your T4E on your tax return. If you need a copy of your T4E tax slip or wish to access it online, you can do so through My Service Canada Account.

In summary, a T4E is an essential document for reporting your EI benefits when filing your Canadian income tax return. Make sure you have it handy when preparing your taxes, and be aware of the various components listed on the slip.

Difference between T4 and T4E

Difference between T4 and T4E

When it comes to tax documents in Canada, T4 and T4E slips are crucial for reporting your income. It’s important to know the differences between these two forms and how they impact your tax filing. Let’s take a closer look at each slip and how they differ.

The T4, or Statement of Remuneration Paid, is a tax slip that your employer issues at the end of the tax year.

It documents the income you earned while working for them, such as salary, bonuses, gratuities, vacation pay, tips, commissions, or wages. A T4 slip reflects your employment income throughout the year.

On the other hand, a T4E is a tax slip issued to individuals who have received Employment Insurance (EI) benefits or certain types of income from the government.

Your T4E will report any EI benefits paid to you, such as regular EI benefits or special benefits in cases of illness, maternity or parental leave, and compassionate care.

During the COVID-19 pandemic, the T4E slip also included the Canada Emergency Response Benefit (CERB) amounts received by individuals.

To summarize, here are the key differences between T4 and T4E:

  • T4 slip reports employment income like salary, bonuses, and commissions
  • T4E slip documents EI benefits or certain government income like CERB

As you file your taxes, it’s crucial to know where each slip fits in your tax return. Your T4 and T4E slips are reported in different sections of your tax return. The T4 slip will typically go into the ‘Employment Income’ section, while the T4E slip will be recorded in the ‘Other Income’ section.

Remember to double-check your tax slips when entering information to ensure you file your taxes accurately.

Understanding T4E Components

In this section, you’ll learn about the main components of a T4E slip in Canada.

Gross Amount of Benefits Paid

The gross amount of benefits paid refers to the total monetary benefits you received from Employment Insurance (EI) or other programs, like the Canada Emergency Response Benefit (CERB).

This amount, reported in box 14 of your T4E slip, includes any deductions made, such as income tax or repayment of overpayments. Keep in mind, this amount should be reported on your tax return.

Total Benefits Paid

Total benefits paid encompass every type of benefit you received, including regular EI benefits, sickness benefits, or other government assistance programs. This figure, along with any deductions, will be reported on your T4E slip.

Tax Withheld

The T4E slip reports the income tax deducted from your benefits. Service Canada deducts taxes at the federal, provincial, or territorial level, depending on your place of residence. You should include this amount on your tax return, as it allows the Canada Revenue Agency (CRA) to accurately calculate your final tax balance.

Tax Exempt Benefits

Tax-exempt benefits are payments you may have received that aren’t subject to income tax. Since they don’t affect your taxable income, these amounts aren’t reflected on your T4E slip.

By understanding these T4E components, you’ll be better prepared to complete your tax return and ensure all information is accurate.

Dealing with Overpayments and Repayments

Dealing with Overpayments and Repayments

When dealing with overpayments and repayments on your T4E slip in Canada, it is important to understand the different aspects of Employment Insurance (EI) benefits and Canada Emergency Response Benefit (CERB).

Overpayments can occur if you’ve received more EI benefits than you were entitled to. This can happen for a variety of reasons, such as inaccuracies in reported earnings, changes in eligibility status, or administrative errors.

If you find an overpayment on your T4E slip, it’s important to address the issue with Service Canada to resolve the matter.

To repay any overpaid EI benefits or CERB, you can:

  • Make a payment using your online banking service by adding “Employment and Social Development Canada” as a payee.
  • Pay by cheque or money order, made payable to the “Receiver General for Canada.” Be sure to include your Social Insurance Number and indicate it is for EI or CERB repayment.

If you’re unsure about your repayment obligations, it’s a good idea to seek advice from a tax professional or contact Service Canada for clarification.

Your T4E slip will provide information on any repayments made towards previously received overpayments.

This can be found in the designated area of the slip, usually indicated as “amount repaid.” Make sure to review this information carefully when completing your tax return, as it may impact the overall amount you owe or are refunded.

Service Canada and Canada Revenue Agency

When dealing with your taxes in Canada, you’ll most likely come across Service Canada and the Canada Revenue Agency (CRA).

These entities play vital roles in managing your tax obligations and ensuring that you understand your requirements, particularly when it comes to reporting Employment Insurance (EI) benefits on your T4E slip.

Service Canada is responsible for issuing T4E slips to taxpayers who have received EI benefits, including those who received Canada Emergency Response Benefit (CERB) payments.

The T4E slip indicates the gross amount of benefits you received, any income tax deducted, and any amounts paid towards overpayments (if applicable).

On the other hand, the Canada Revenue Agency (CRA) is responsible for collecting and managing federal taxes in Canada. They’ll use the information provided on your T4E slip to assess your EI benefits and other taxable income.

If you’re a Quebec resident, you’ll also receive a T4E(Q) slip, similar to the T4E slip, but with an additional copy to attach to your provincial tax return.

When filing your taxes, it’s essential to report your EI benefits on Line 23200 of your tax return. Meanwhile, any repayments you made will also appear on your T4E slip, which need to be reported too.

To better manage and keep track of your T4E slip information, consider signing up for a My Service Canada Account (MSCA). This online platform allows you to access your tax information, including T4E slips, and make any necessary updates to your personal information.

By staying on top of your tax obligations and communicating with Service Canada and the CRA, you’ll ensure a smoother tax season and avoid any potential issues down the road.

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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