knowledge topics
Income Received by Employees
KNOWLEDGE EXPECTED OF: Both CFP® Professionals and QAFPTM Professionals
- Identify the types of income that may be received by an individual.1
- Identify the types of income that may be received by an employee.2
- Identify the types of income that are included in employment income.3
- Identify sources from which employment income may be found, such as:
- T4
- Paystub
- Direct deposit
- Tax return
- Record of employment
- Explain when the Canada Revenue Agency considers an employee to have received a taxable benefit.4
- Explain the factors the CRA may consider when determining if an employee benefit is taxable, such as:
- Type of benefit
- Reason the benefit is provided
- Benefit received
- Identify taxable benefits that may be added to an employee’s income.5
- Explain how the value of a taxable benefit is determined.6
- Explain the tax treatment of income received by an individual from an employer paid group wage replacement plan.
- Explain when a taxpayer will incur a taxable benefit related to the receipt of stock options through an employer.
- Estimate the tax impact to an employee from the receipt of a taxable benefit.
- Identify non-taxable benefits that will not be added to an employee’s income.7
- Explain the tax impact of receiving each type of income.
- Estimate the tax impact of receiving each type of income.
- Identify how a salary deferral arrangement (SDA) affects the taxation of income.8
Glossary of Verbs (mouse over to see definition)
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a judgement through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally

REFERENCES
- http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/llncm-eng.html
- http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/mplymntncm-eng.html
- http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/rtrns/t4/slps/cmpltng/bx14-eng.html
- http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/menu-eng.html
- http://www.cra-arc.gc.ca/E/pub/tg/t4130/t4130-e.html#P464_44295
- http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/menu-eng.html
- http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/hlth/prvt-eng.html
- https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-deductions-contributions/special-payments/salary-deferral-arrangements.html