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WSIB - question

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  • WSIB - question

    For the last year of work (2019) before my retirement - I received some WSIB for being off for diagnosed PTSD.
    In January 2020, I received my T4 - I had made the same amount as I always did however I had had some of my salary obtained via WSIB.
    An argument with the ex began because my NOA total income for 2019 is some 38K over what my T4 has indicated.
    My ex has indicated that my new income has to be upvalued and the amount for CS for 2019 has to be re-determined.
    I realize that the WSIB is not taxed...however... during 2019, I never received any more monies than my usual income.

    My question to anyone smarter than me is this... how or better yet WHY, am I to be expected to pay more on an amount I did not receive? WSIB grossed up for CS purposes when the payor does not get any financial compensation?
    Yes - I know there are tax implications and that my tax return received in 2020...was more than in previous years.
    Can anyone indicate WHY WSIB is required to be grossed up?

  • #2
    WSIB - question

    WSIB is grossed up probably because they don’t take any deductions off it. Plus it may include costs for treatment?

    Your t4 is what the company paid you so while you earned the “same” income last year, your company is not paying you, WSIB paid part of it. Your NOA will show your true income for 2019.

    You *could* argue that you standard income from previous years should be used as your WSIB was not taxed the same way your income is and it was for disability. It was a one time thing therefore not legit for cs purposes.

    The problem though is she could take you to court to hear a judge say it and to have it decided that way. Problem is a judge may say yes you have to pay.

    Either way you can’t use just your t4 income for support purposes because WSIB was paying you on behalf of your company.

    Best bet is to take off whatever the tax deduction would have been (or what your actual annual salary would have been) and offer to update cs to that. If she refuses to accept that let her file the motion and go to court.


    • #3
      I am in the same boat. My employer opted to pay the employee directly (they top up to 100%) so I got a T4 from the employer for my actual normal salary. Then WSIB sent me a T4 for $60K even though they pay my employer. I made $110K from my employer but because WSIB sent me another T4, on paper I made $60K more than I actually made. Obviously, this increases my income substantially which also increases my child support obligation. Anyone else been through this?


      • #4
        Unless you received a raise, I'm puzzled why your NOA is showing a large income INCREASE. I think WSIB pays around 85% of your prior earnings so if anything you should see slightly less than your usual income amount assuming no changes to your base pay. I would review every pay and wsib payment received during 2019 to see what's going on.

        While I can't help you with the income jump, I believe the reason why WSIB payments are "Grossed up" for CS purposes is that CS payments are based on gross (pre-tax) amounts. Since wsib is tax free, you need to gross it up to the amount you would have been paid pre-tax to "net" the wsib payment.

        It's ridiculous that the government uses "gross" pay for CS when you can't deduct the payments but that's another argument.


        • #5
          Some employers choose to pay their injured employees directly when they are on WSIB. And some let WSIB pay their employees. My employer pays me my full salary but WSIB pays my employer 60% so both of the numbers show up as my income. Even though I don't make that much. My t4 says the amount that I have actually gotten paid and they also include the amount that WSIB has paid them on this T4. BUT WSIB also sends a tax slip called T5007 with the amount they paid the employer. When my accountant does the taxes it shows that my line 150 income is the regular amount plus the WSIB amount. Does this make sense?


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