What box do I add my tips earned on my t4?

You can report tips and gratuities along with other income that does not appear on T4 slips on line 10400 of your tax return as other employment income.

In TurboTax Online,

1. Go to your Return.
2. Then on the top of the page in the search bar type in 'TIPS'.
3. Then you will see 'Tips, Gratuities and Other Income', and click Go.  
4. This is where you will enter your tips.

For more information on how to calculate your total amount for tips and gratuities, please see our following TurboTax articles, 

Do I Need to Claim My Tips on My Tax Return?

What You Need to Know About Tips, Gratuities and Your Taxes.

 

 

 

The way you receive tips—whether via your employer or customer—can make a difference in how you report them. There are 3 types of tips to know: controlled tips, direct tips, and declared tips.

 

1. Controlled Tips

Controlled tips are tips that an employer controls, collects, and pays to their employees. The Canada Revenue Agency (CRA) considers controlled tips as business income for the employer. So controlled tips are part of an employee’s salary or a form of compensation, where employers have to deduct CPP contributions and EI premium.

For example, let’s say you work as a server at a restaurant and the restaurant owner pools together all the tips, so all staff members get a share of those tips. 

Other examples of controlled tips include when employers:

• add mandatory service charges or a percentage to a client’s invoice to cover tips
• distribute tips to their employees using a tip-sharing formula
• include tips in their business income and later pay them to their employees

Your T4 slips will have your employment income in Box 14, which may include controlled tips. Enter the total amount from Box 14 on Line 10100 of your return.

 

TurboTax Online Instructions: 

Go to the left side menu ≡ and click: Income > T-Slips > T4 Employment Income 

 

2. Direct Tips

Direct tips are untaxed income where the customers pay the employees directly. Employers have no control over this amount, so they aren’t subject to CPP or EI payroll deductions. An employee can choose to make CPP contributions by filling out Form CPT20. Direct tips won’t be included in your T4 slip, but you’re still required to report this as income on Line 10400 of your income tax return.

Examples of direct tips can include:

• cash tips that a customer leaves for their restaurant server to keep
• pooled tips controlled and distributed by employees
• tips paid with a debit or credit card and the employer returns the amount directly to the employee

TurboTax Online Instructions:

1. Go to the left side menu ≡ and click: Income > Other Income Sources > Income not reported on a T-Slip

2.Check the box: Received tips, gratuities, occasional earnings, or other employment income

 

3. Declared Tips (Quebec Only)

Declared tips are direct tips that require employees in Québec working in regulated establishments such as hospitality, to report their tips to their employers. The employer then combines direct and controlled tip earnings to include the total in a worker’s insurable earnings.

Report your tips at the end of each pay period by filling out form TP-1014.4-V. 

 

Please refer to this TurboTax article: 

What You Need to Know About Tips, Gratuities and Your Taxes

 

Thank you for choosing TurboTax.