The answer to this question is it depends.
These types of insurance follow similar taxing rules:
- group life insurance,
- dependant life insurance,
- accidental death insurance and
- critical illness insurance.
Any premiums the employer pays for employees’ insurance types noted above less the portion the employee pays (either directly or through reimbursements) are taxable benefits.
Here is the link if you wanted additional information: https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/benefits-allowances/group-term-life-insurance-policies-employer-paid-premiums.html.
For short/long-term disability premiums, if the employer pays for the premiums, they are not taxable a benefit. If the employee later gets payouts from this insurance, then it would be taxable (on the T4) normally issued by the insurance company. Conversely, if all employees pay their own short/long-term disability premiums, any benefits they may later receive are tax-free.
