Who pays the tax on fringe benefits?

HR need to be aware of the tax implications of unique perks
By Christopher Newton
|Canadian HR Reporter|Last Updated: 05/05/2003

F

ringe benefits, or perquisites, sound attractive, but are not entirely “free” if they attract tax. HR professionals have to be aware of when a “perk” is a taxable benefit in order to ensure employee communications convey this information effectively, payroll deductions are made properly and benefit plans are designed appropriately.

A taxable fringe benefit may not meet the desired goal of attracting and retaining employees if it comes with too big a price tag.