Plan sponsors with Beneplan who are not ASO may notice that there is tax withheld from their patronage dividend (the refund of premium if their plan was in surplus). 

The Canada Revenue Agency requires that dividend income from co-operatives be subject to a mandatory withholding tax of 15% for amounts above $100. You can report this on your next corporate tax return (T2) on lines 880 and 881, so that you are not double-taxed. You will also receive a T4A statement later this year. 

Charities or not-for-profit organizations are exempt; if you feel that you have been taxed in error, please contact your benefits advisor.

With respect to Partnerships, Beneplan is not able to split the T4 or dividend into multiple amounts; Beneplan is required to pay dividends in line with the master policy holder on file. If you have a Partnership and would like your dividend paid to a different company, such as a management firm or holding company, please contact us to change your master policy holder on file.

Refunds of premium for groups in an ASO environment (self-insurance) are not subject to withholding tax.

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