Are honorariums taxable?

Are honorariums taxable?

Bookkeeping work that was previously unpaid volunteer work is now receiving a monthly honorarium.

This is for a soccer assoc. so I guess they aren't registered for payroll and do it as an honorarium.

What are the tax implications for the receiver of this honorarium? Is he supposed to claim the honorarium on his personal income tax (even though he has no tax slip). If he does I imagine he would have to pay CPP and EI on the honorarium?

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I think you might want to visit The Tax Guy at blog.taxresource.ca. He has a question section and is probably more versed in tax matters than I am.

You may also want to check out CRA's special payment chart on honorariums subject to CPP & EI.

If you are a self-employed bookkeeper, I'd just take the monthly amount into income ... which is what you should also do if you receive tips / bonuses from your clients.

P.S. I would like to remind you there is a difference between information and advice. The general information provided in this post or on my site should not be construed as advice. You should not act or rely on this information without engaging professional advice specific to your situation prior to using this site content for any reason whatsoever..

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Jan 24, 2011
CPP and EI
by: Anonymous

The Tax Guy said this:

"Complete form T2125 and submit it with your tax return if this is a business activity otherwise add it to line 101 as employment income. The payments are taxable and may be subject to CPP but you are not required to pay into EI"

My comment: I believe you would add (shown by Lake's CRA link to EI) that contrary to the Tax Guy's statement, EI is to be added to the Honorarium as well as CPP if it is not self-employment income reported on schedule T2125.

Jan 25, 2011
by: Lake

Thank you for taking the time to post here to let us know what The Tax Guy said. Appreciate it. :0)

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