February 25, 2010 at 12:00 PM
To CAW Members
Last August we were advised by the company via a Jazz Flash that the Canada Revenue Agency (CRA) was conducting an audit of Jazz and assessing if employee parking was a taxable benefit for Jazz employees. It is also important to emphasize and reiterate that Jazz is not the only airline currently being targeted by CRA on this issue.
Unfortunately, Jazz has been notified by CRA that it’s their position that employee parking should be assessed as a taxable benefit for Jazz employees who have either been issued a company parking pass for company owned parking lots or for those that have their parking paid for by the company ("qualifying Jazz employees"). To be clear, this assessment will be done on all ALL "qualifying Jazz employees".
How does this affect me?
The Notice of Reassessment will require you, as a taxpayer, to remit (i.e. pay) taxes on the parking benefit in accordance with your personal marginal tax rate. For example, if the parking amount was deemed to be $700.00 for each year (2006 and 2007), then you would owe tax on $1,400.00 of income at your tax rate.
If your marginal tax rate was 33% you would owe $462.00 to CRA (the combined amount for the 2006 and 2007 tax years). However, if you object by filing a waiver, you do not need to remit any relevant tax until this issue is resolved. However, you will be subject to interest on unremitted income tax if the objection is ultimately not resolved in your favour.
The company has asked the Union to consider an option that might help with efforts to convince CRA to postpone this decision. After our review of the matter, we have decided to try to get as many Mechanics as possible to file a waiver in respect of normal reassessment period (see attached) to allow CRA to keep your 2006 tax year open for reassessments for parking as a taxable benefit issue only (all other tax issues would become statute barred for 2006 based on the date of the notice of assessment received by the tax payer).
| The company is meeting this Friday with CRA. Please note that the timeline is very tight.
In order to have a chance at being successful (i.e. we have no guarantee that CRA will accept the waivers) in getting CRA to postpone notice of reassessments it is important to have as many waivers as possible submitted. |
What do you need to do to submit the waiver?
Please see the attached standard form waiver. If you would like to file a waiver, we ask that you do so by Thursday, February 25, 2010. Please complete the information on the waiver and ensure you:
- sign and date the waiver at the bottom of the page; and
- Return the signed copy to Jazz (refer to options outlined below).
There are 3 ways to submit the waivers:
- Scan the completed signed waiver form and email it to: [email protected]
- Or, complete the waiver form and place in a designated envelope in Jazz crew rooms.
- Or, fax the complete waiver form to (902) 873-5079. Complete the form by printing your name, address, and social insurance number (SIN) in the applicable boxes on the attached forms.
Form: Canada Revenue Agency
Note: This document has been created in conjunction with Jazz Air Payroll and Benefits Department