BISHOP S UNIVERSITY GUEST LECTURER & SPEAKER REMUNERATION POLICY

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BISHOP S UNIVERSITY GUEST LECTURER & SPEAKER REMUNERATION POLICY Effective Date: January 1 st 2013 Prepared by: Business Office Policy Number: VPFA-04-2013 Approved by: Bishop s Executive Group December 2012 Revised: January 2016 1.0 SCOPE Payments by Bishop s University to individuals for guest lectures and/or speaking engagements, whether for a fee or as a token of appreciation, must be processed in compliance with the respective taxation requirements and legislations. Refer to the Procedures section for details regarding the implementation and interpretation of the following policy. 2.0 DEFINITIONS A GUEST LECTURER/SPEAKER REMUNERATION is a pre-established or token amount paid to a person with expertise in a particular field to give one or a few lectures for the University. The payee has no appointment with the University and is engaged for his or her expertise on a particular topic (rather than as a substitute for a regular instructor). A guest lecturer/speaker has no ongoing responsibility to the participants (e.g. grading). The term HONORARIA was generically used in the past to describe these types of payments and other contributions towards a specific activity. However, since the Canada Revenue Agency may classify honoraria as employment income, this term shall no longer be used and will be replaced by GUEST LECTURER/SPEAKER REMUNERATION to describe payments received by these individuals. RELATED TRAVEL EXPENSES incurred by the guest lecturer/speaker may be paid by the University. This may take the form of direct reimbursements for out-of-pocket expenses, or amounts paid to a third party (e.g. hotel or travel agency) on behalf of the guest lecturer/speaker. 2011-VPFA-03, January 1 st, 2013 Page 1

3.0 POLICY Fees: it should be clearly identify in the contract and/or invoice the currency of the fees 3.1 Fees Paid to an Employee If a guest lecturer/speaker fees is paid to a University employee, it will be processed via Payroll and considered employment income. Consequently, they are included on the T4 Statement of Remuneration (and the equivalent Quebec Relevé 1) for the calendar year in which the fees were paid. 3.2 Fees Paid to a Non-Employee 3.2.1 Canadian Resident Guest lecturer/speaker fees paid to a non-employee, who is a resident of Canada, are processed via Accounts Payable. They will be reported on a T4A (and the equivalent Quebec Relevé 2) as Other Income for the calendar year in which the fees were paid, and no taxes will be withheld. 3.2.2 Non-Resident The University will apply the same criteria as the CRA to determine a guest lecturer / speaker s residency status. These rules can be found at: http://www.cra-arc.gc.ca/tx/nnrsdnts/ndvdls/nnrs-eng.html?=slnk Guest lecturer/speaker fees paid to a non-employee, who is not a resident of Canada, are processed via Accounts Payable. They will be reported on a T4A-NR (and the equivalent Quebec slip) for the calendar year in which the fees were paid. In general, non-residents are subject to withholding tax on all such fees received. At the effective date of this policy, federal and provincial withholding rates are 15% and 9% respectively; these rates are subject to change without notice. To apply for a reduced amount of withholding tax, the individual must complete the appropriate federal and provincial documentation at least 30 days before the services are rendered: Federal: Regulation 105 Waiver Application Provincial: TP-1016-V Application for a Reduction in Source Deductions of Income Tax for an Individual or a Self-Employed Person and CO-1016-T Application for a Reduction in Source Deductions of Income Tax for Corporations not Resident in Canada Please note that is the responsibility of the speaker to obtain these waiver documents. In their absence accounts payable will withhold the corresponding percentage. 3.3 Reimbursement of Travel Expenses Reimbursement of reasonable travel expenses incurred by or on behalf of the guest lecturer/speaker is processed through Accounts Payable and in adherence to the Bishop s University Expense Reimbursement Policy. This applies to all reimbursement amounts, either paid directly by non-resident or to a third party on behalf of the non-resident. 2011-VPFA-03, January 1 st, 2013 Page 2

3.3.1 Canadian Resident The reimbursement of reasonable travel expenses is not considered income and therefore is not reported on a T4 or T4A slip. 3.3.2 Non-Resident The Canada Revenue Agency allows payments for reasonable travel reimbursements (in respect of transportation, accommodation and meal costs) to be exempt from withholding taxes. Reimbursements must be based on actual expenses. However, if the reimbursement for meals does not exceed $45 per day per person (subject to change without notice) and the reimbursement for accommodation does not exceed $100 per day per person (subject to change without notice), supporting receipts need not be provided. In this case, an appropriate per diem amount can be claimed. In all other cases, in order to be exempt from withholding taxes, travel reimbursements must be supported by appropriate vouchers detailing the expense. Note: Consequently, mileage allowances are not eligible for this exemption. Reasonable and justified travel expenses will be included on Form T4A-NR under travel expenses and no tax will be withheld. Unreasonable and/or unjustified travel expenses will also be included on Form T4A-NR and will be subject to withholding tax. 4.0 PROCEDURES 4.1 Administrative Responsibility The administration and overview of the fees paid to employees is under the responsibility of Payroll Services within the Business Office. As such, any related inquiries should be directed to (819) 822-9600 ext. 2206. The administration and overview of the fees paid to non-employees is under the responsibility of Accounts Payable within the Business Office. As such, any related inquiries should be directed to (819) 822-9600 ext. 2207. The administration of travel and other personal reimbursements are under the responsibility of Accounts Payable within the Business Office. As such, any related inquiries should be directed to (819) 822-9600 ext. 2207. 4.2 Administrative Process 4.2.1 Establishing the Payment Process The process for paying a guest lecturer/speaker fee is outlined below, based on the status of the guest lecturer/speaker and their relationship to the University: 2011-VPFA-03, January 1 st, 2013 Page 3

Is the guest lecturer / speaker: A University employee? A Canadian Resident? To process guest lecturer / speaker fee: To process reimbursement of related travel expenses: Yes n/a Via Payroll and adhering to standard Payroll requirements. The amount will be included on the employee s T4. No Yes Via Accounts Payable by completing a Reimbursement Request Form and adhering to the Form Instructions. The recipient s date of birth, Social Insurance Number, and home address must be clearly noted on the cheque request form. The amount will be included on a T4A. No No Via Accounts Payable by completing a Reimbursement Request Form and adhering to the Form Instructions. The recipient s date of birth and home address must be clearly noted on the cheque request form, as well as the fact that they are not a Canadian resident. The amount will be included on a T4A-NR and tax will be withheld. n/a Via Accounts Payable by completing a Form and adhering to the Form Instructions and the Travel Expense Reimbursement Policy. Via Accounts Payable by completing a Form and adhering to the Form Instructions and the Travel Expense Reimbursement Policy. The amount will be included on a T4A-NR but no tax will be withheld so long as the expenses are reasonable and justified. Claims for both the guest lecturer/speaker fee and the reimbursement of related travel expenses can be combined on a single Form so long as the various components are easily identifiable. To substantiate the guest lecturer/speaker fee, include any written invitation or agreement with the individual, or a copy of the poster or pamphlet relating to the speaking engagement. 2011-VPFA-03, January 1 st, 2013 Page 4

4.2.2 Roles and Responsibilities The Department hosting the guest lecturer/speaker is responsible for informing the recipient of the required documentation and related income tax implications, and ensuring the documentation requirements are met to avoid payment delays. It is also the responsibility of the host department to ensure that all mandatory information is obtained (e.g. date of birth, SIN, home address) and that the Form is completed as per the Form Instructions. The Authorized Signatory (either for Payroll or on the Form) is responsible for ensuring that expenses and resulting payments are legitimate, appropriate, reasonable, for University purposes only and are in accordance with University policies and guidelines. Furthermore, the authorized signatory ensures compliance with any restrictions that may be associated with the source of funding (e.g. donors, agencies). The Payroll or Accounts Payable Division of the Business Office is responsible for processing the duly completed paperwork to ensure that the guest lecturer /speaker (or the third party who engaged expenses on his/her behalf) receives payment within a reasonable delay. The Business Office is also responsible for issuing any tax slips and remitting to the government any tax withheld. 2011-VPFA-03, January 1 st, 2013 Page 5