Central Okanagan-Similkameen-Nicola MP Dan Albas introduced a private member bill Friday to help employers retain university and college graduates struggling with student loans.
If an employer currently wants to help an employee pay off his student loan, with a bonus or part of his salary, that will be taxed as ordinary income.
Albas’ Bill C-317, a law amending the Income Tax (Student Loan Repayment Assistance) Act, allows employers and employees to enter into voluntary arrangements whereby payments made by an employer to an employee under a student loan support program are a non-taxable benefit.
“Young people tell me all the time that graduating with thousands of dollars in student loans is a huge hindrance to their plans for the future,” Albas says. “This bill will help people struggling with student loans by encouraging them to work and save.”
Albas says that young adult student loan credit is often cited as a major reason for economic anxiety. By allowing employees and employers to voluntarily enter into an arrangement where a portion of the employee’s wages go towards student loan repayment as a tax-free benefit, young people could help pay off their debts and start saving. for the future, explains the local MP.
“This legislation will also help employers attract and retain talented employees,” says Albas. “This bill is a win-win across the board and I hope it gets broad support in Parliament.”