What is deducted from LTD benefit payments?


#1

I am having a hard time finding info on this topic. I haven’t received my first LTD (employer group insurance) benefit payment yet, and I am wondering what deductions are made from each month. I assume the regular income tax deduction but am not sure about CPP/EI/payroll deductions as I am on a leave due to illness from work. My employer pays 85% of my DI premiums and I pay 15% when working. Obviously I haven’t been paying any premiums or deductions while not working. My disability benefit will be 70% of my gross income, I just can’t find the information that I thought I had on what will be taken at source. Thanks!


#2

As your employer contributes to your premium your LTD is subject to income tax and cpp deductions. Not sure about other payroll deductions --union dues are typically waived


#3

I second allyhoops opinion, just would like to add that there shouldn’t be payroll deductions. You would be subject to Prov/Fed Tax, CPP and EI deductions as your employer covers most of your premiums.


#4

Thanks very much! I believe I will need to do a pension buy-back when I hopefully am able to return to work, so do not need to pay that, union, or health/dental benefits until I return. I believe I read somewhere that my previously contributed DI premiums can be used towards income tax purposes while on benefits for the next return, but I will have to find out more when I get my first payment. Income tax/CPP/EI would certainly make sense. Appreciate your time!!! :slightly_smiling_face:


#5

The deductions can vary from no deductions to several deductions. This is why you wouldn’t be able to find general rules or information. It would be very specific to your own policy and employment situation.


David Brannen

Disability Lawyer with Resolute Legal

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