Door Prizes at Company Functions

In a 2013 Technical Interpretation, CRA was questioned about door prizes received by all attendees at a company social function.

PartyCRA commented that their tax-free $500 gifts and awards policy would apply to all attendees including the employee, the employee’s spouse, and all other non-arm’s length individuals that received a gift. It was suggested that gift cards might be given as door prizes. CRA stated that these near cash gifts would not be included in the $500 gifts and awards policy. Instead, the near cash gifts would be taxable benefits to the employees.

Additional details related to CRA’s gifts and awards policy are available at www.cra.gc.ca/gifts.

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