Will my employer's relocation reimbursement be taxable?

Arsen Accounting Services · Question 128 · Sources checked October 29, 2026

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Some employer-paid moving costs can be non-taxable under CRA's rules or administrative policy, while other relocation benefits are taxable. The answer depends on the expense and arrangement, not simply whether the employer calls the payment a moving allowance.

Separate the components

CRA distinguishes reimbursements of particular moving costs, allowances, and compensation for housing losses. Certain expenses paid because an employee moves to a new work location can receive non-taxable treatment, but the conditions differ by category.

Your personal moving-expense deduction is a separate calculation. An amount paid or reimbursed by the employer should not also be claimed personally without checking the applicable treatment. A non-taxable reimbursement and a deduction for the same cost can create a duplicate claim.

Official guidance: [1].

Build a gross-to-net schedule

Suppose the employer pays the moving company directly, reimburses travel, and provides a separate lump sum. Record those as three items. The lump sum should not be assumed to share the treatment of the moving-company invoice.

Gather the relocation records

• The employer's relocation policy and offer letter.
• Itemized invoices and receipts.
• Reimbursement statements and direct payments to suppliers.
• The allowance and taxable-benefit amounts reported by payroll.

Ask payroll to explain any taxable portion before relying on the full payment for the move. Give your preparer a list of costs you personally bore after reimbursements. If a housing loss, loan, or unusual benefit is involved, identify it separately so it receives the specific review it needs rather than being buried in a general moving total.