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Legal Ease
Legal Ease, Lawyer
Category: Canada Tax
Satisfied Customers: 101406
Experience:  Lawyer
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I received a retroactive lump sum payment through workmens

Customer Question

i received a retroactive lump sum payment through workmens comp due to my husbands death 15 years ago. He was a firefighter and died of melanoma, this cancer is now deemed as a presumptive cancer for firefighters. We made a retroactive claim and have received $65,000 for his pain and suffering and have been reimbursed for funeral and medical expenses. I have also just received $276,000 for a 5 year widow's pension and a payout for vocational allowance What will be the taxes on these payouts? It was indicated that the $65,000 was a non economic payout, does this mean I do not have to pay taxes on this amount?
Submitted: 2 years ago.
Category: Canada Tax
Expert:  Legal Ease replied 2 years ago.

I am sorry for your loss.

It is not income. It doesn't replace income but is for damages for paid and suffering.

So you do not declare that as income for tax purposes.

Customer: replied 2 years ago.
even for the widow pension lump sum, I will not have to pay taxes
Expert:  Legal Ease replied 2 years ago.

No. I believe you do have to pay taxes on the pension if that is in lieu of income. You just do not pay taxes on a payout for pain and suffering.