Understanding Your T4PS Slip: Why You Owe Tax on Money You Haven’t “Received”
Receiving a T4PS slip can be perplexing for many Canadian employees, as it reports income you haven't actually "seen" in cash. Unlike a standard T4 slip, the T4PS reflects allocations from your employer's profit-sharing plan, which are taxable even if you haven't withdrawn the funds. This guide unravels the complexities of the T4PS, explaining why you owe taxes on "phantom income," how to navigate foreign tax credits, and the benefits of reinvestment. Discover how to strategically manage your T4PS to align with your long-term financial goals and avoid tax surprises come April.
