The T5007 tax slip, officially called the Statement of Benefits, is a tax slip that reports the workers’ compensation benefits and social assistance payments received by Canadian residents during a calendar year.
This guide will explain what the T5007 is, who receives it, what information it contains, how it impacts taxes, and more, using helpful tables.
What is the T5007 Tax Slip?
The Canada Revenue Agency (CRA) requires provincial, territorial, and municipal agencies or boards that provide workers’ compensation benefits and social assistance to report the amounts paid annually on a T5007 Statement of Benefits.
Specifically, the T5007 tax slip lists the following types of benefits paid to recipients in a calendar year:
- Workers’ compensation benefits: Includes payments for injury, disability, or death under provincial workers’ compensation legislation. This can include wage replacement benefits, disability pensions, and survivor benefits.
- Social assistance payments: Includes support payments for basic needs like food, clothing, shelter, and transportation. It can also include actual amounts paid for rent, mortgage, and utilities.
While these benefits are generally not taxable, reporting them on a T5007 slip allows recipients to accurately claim income-tested credits and benefits. The statement of benefits T5007 provides proof of benefits received for reporting on tax returns.
Who Gets a T5007 Tax Slip?
The general threshold for issuing a T5007 tax slip is $500 in total benefits received during the calendar year. Those who received less than $500 in combined workers’ compensation and social assistance do not receive a T5007.
However, certain types of payments and benefits do not count towards the $500 threshold and, therefore, do not generate a T5007. These exceptions include:
- Medical expenses, health benefits, and respite care
- Child care subsidy
- Funeral expenses
- Legal fees
- Job training or counselling costs
Additionally, social assistance payments of less than $500 that are not part of a regular series of payments do not get reported on a T5007.
If an individual receives benefits from multiple programs exceeding $500 each (for example, social assistance and workers’ compensation), they may receive multiple T5007 slips – one from each applicable agency or board.
The key deciding factor is whether total benefits received from a particular agency or board exceed the $500 reporting threshold.
What Information is on the T5007 Tax Slip?
The T5007 tax slip contains four key boxes to report benefits paid to recipients:
Workers’ Compensation Benefits (Box 10)
Box 10 reports several types of workers’ compensation benefits, including four main types:
| Type of Benefit | Description |
| Wage Replacement | Replaces lost income for time off work |
| Disability Pension | Ongoing income support due to disability |
| Permanent Impairment | Lump sum payment for permanent disability |
| Survivor Benefits | Income support for dependents of deceased worker |
Importantly, Box 10 includes both direct payments to the injured worker as well as “self-insured” payments where the employer reimburses the worker and claims compensation separately.
However, Box 10 does not include rehabilitation expenses, clothing allowances, medical costs, funeral benefits, or interest portions of a settlement.
Social Assistance Payments (Box 11)
Box 11 on the T5007 reports provincial and territorial social assistance paid to recipients for basic support needs, including:
- Food, clothing, shelter assistance
- Transportation allowances
- Actual rent, mortgage, and utility amounts
As with workers’ compensation, certain social assistance payments are excluded from the T5007, such as:
- Medical expenses
- Child care subsidy
- Legal fees
- Job training costs
Recipient Information (Boxes 12-13)
Box 12 contains the social insurance number (SIN) of the individual receiving the reported benefits. This allows accurate tracking of benefits paid.
Finally, Box 13 indicates if the T5007 is an original, amended, or cancelled slip. Amended slips require an explanation of the change at the top.
How Does the T5007 Affect My Taxes?
The key thing to understand is that while not directly taxable, the benefits reported on the T5007 impact taxes in a few important ways:
Workers’ Compensation Benefits
- Enter amount from Box 10 on Line 14400 of your tax return as part of total income
- Deduct the amount from Line 14400 on Line 25000 to remove it from taxable income
Social Assistance Payments
- Enter amount from Box 11 on Line 14500 as part of total income
- Deduct the amount from Line 14500 on Line 25000
Benefits and Credits Calculation
- Reporting T5007 income allows accurate calculation of tax credits and benefits like:
- GST/HST credit
- Canada child benefit
- Provincial tax credits
- Eligibility for income-tested benefits like the Guaranteed Income Supplement (GIS) is not affected by reporting T5007 amounts
Therefore, while not directly taxable, reporting benefits on the T5007 ensures recipients get the full credits and benefits they are entitled to based on their total income.
When and How Do I Get My T5007 Tax Slip?
The CRA requires T5007 slips to be issued and delivered to recipients by the end of February each year, for benefits paid in the prior calendar year.
The agency or board providing the benefits will mail the T5007 tax slip to the recipient’s last known address or make it available electronically.
If you have moved or do not receive your T5007 by the end of February, contact the applicable agency to request a reprint of the slip.
If benefits stopped and your file was closed, your T5007 may have been sent to your old address, so follow up with the agency if you are expecting one.
What If There Are Errors on My T5007 Tax Slip?
If you receive a T5007 tax slip and notice an error in the amount of benefits reported, contact the agency that issued the slip to request a review. Be prepared to explain what information is incorrect and why.
If the agency determines the slip should be corrected, they will issue an amended T5007 slip with the updated information. This amended slip will have Box 13 marked with code “A” indicating it is amended.
If the amended T5007 changes benefits reported for a prior tax year, you must file a T1 Adjustment Request with the CRA to amend your tax return and correct your income amount for that year.
How Do I Report Repayment of Benefit Overpayments on My Taxes?
Sometimes, an individual may receive an overpayment of benefits that they later have to repay to the agency. This creates a tricky tax situation that depends on when and how the overpayment is repaid.
If you repaid an overpayment in the same year you received the benefits, the T5007 will reflect this repayment and show your net benefit amount for the year.
However, if the overpayment relates to benefits received and reported in a previous tax year, the process is more complex:
- You will receive an amended T5007 for the previous tax year showing the corrected, lower benefit amount after the overpayment deduction.
- File a T1 Adjustment Request to amend your tax return for that previous year to report the revised income amount.
- You cannot claim the repayment amount as a deduction in the year you repaid it.
This ensures the benefit amount is accurately reported based on when it was received, even if the overpayment is repaid and adjusted later.
Key Takeaways on the T5007 Statement of Benefits
In summary, six key details on the T5007 include:
- Reports workers’ compensation and social assistance over $500
- Total benefits entered on Lines 14400/14500 and deducted on Line 25000
- Allows accurate calculation of income-tested credits/benefits
- Issued each year by February 28 by the paying agency/board
- Contact the agency about any errors or amendments needed
- Repayments may require amending prior years’ tax returns.
Tax time can be confusing with all the different slips you might get. To help you out, we’ve made a quick list of the most common ones. You can check them out below:
The bottom line
The T5007 slip may seem complicated at first glance, but like anything tax-related, taking the time to understand it now can save you significant stress and audit risk down the road.
Hopefully, this guide with helpful tables provides everything needed to confidently understand the T5007 tax slip. Taking the time to properly report benefits can avoid major headaches at tax time!
FAQs related to T5007 Tax Slip
How do I get a copy of my T5007 tax slip?
You can contact the agency or board that issued the T5007 to request a reprint if you did not receive it or need a new copy. It is also sometimes available online through the agency's website.
When will I receive my T5007 tax slip?
T5007 slips are issued annually by the end of February for benefits paid in the previous calendar year. If you have not received it by early March, follow up with the agency.
Do I report my T5007 amounts if they are under $500?
No, if the total benefits paid by an agency are under $500 for the year, they do not need to be reported. The $500 threshold is for each agency/benefit type separately.
Where do I find my social insurance number on the T5007 tax slip?
Your social insurance number is listed in Box 12 of the T5007 slip. This identifies the specific recipient of the reported benefits.
Why are non-taxable benefits reported on a T5007 tax slip?
While not taxed directly, reporting T5007 amounts allows accurate calculation of income-tested credits and benefits based on your total income.
How does receiving workers' compensation benefits affect my taxes?
You enter the amount from Box 10 of your T5007 on Line 14400 of your tax return and deduct it on Line 25000 so it does not get taxed directly.
