Survivor Benefits Should Not Be Taxed - Says Widow of Soldier

by Karl Gotthardt - albertacowpoke | May 9, 2011 at 04:07 pm

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The widow of a soldier that was killed by a suicide bomber in 2006 in Afghanistan is fighting the Canadian government to eliminate taxes on survivor benefits. Chantel Roy from Lincoln, New Brunswick was four months pregnant when she learned that her fiance, Private David Byers was killed.

Private David Byers was serving with the Princess Patricia's Canadian Light Infantry in Afghanistan in 2006, when he and three others were killed by a suicide bomber.

Chantel Roy received a lump sum payment of $226,000, which was taxed. Five years later she receives a pension of $1500 and another $1100 for the couples child. This represents 60% of Private Byers salary at the time of his death. Both benefits are taxed.

Chantel Roy contends that since David died serving his country, these benefits should be tax free. She points to the U.S. military which do not tax these benefits. In all likelihood Byers did not have enough time in the military to qualify for a pension, therefore there would have been a return of contribution he made into the Canadian Forces Superannuation fund. The payment she is receiving would be one paid by the Serviceman's Income Security Plan (SISIP) which pays 60% of a serviceman's salary at the time of death.

Roy says she would love to go back to work, however her additional earnings would put her in a higher tax bracket, making it difficult for her and other widows. She has started an online petition and asked for a meeting with re-elected Conservative MP Keith Ashfield, who formerly served as Minister of Revenue.

There has been a lot of criticism recently of the treatment of Veterans in Canada, specifically dealing with lump sum payments rather than monthly benefits. In some cases individual privacy was violated. While the Department of Veterans Affairs and the Department of National Defence will not comment on specific cases. The Royal Canadian Legion is also seeking changes on how survivor benefits are paid out.

Canadian soldiers have been in Afghanistan since January 2002, many of them with multiple tours. The war has taken its toll in killed, wounded and mental health issues. Canada's combat mission will end in July, when Canadian troops will take on a training roll reducing its contingent to 1000 trainers.

Canadian Forces Death Benefits as Posted by CMP

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foxy10935@hotmail.com (not verified)

at 17:06 on May 9th, 2011

I think the biggest part of her benefits should have been put into a trust fund for their daughters education, as for her going to work we all have to pay taxes even on our pensions.....to me this is just a lame excuse for not working.....thanks for this report...appreciate it greatly

Karl Gotthardt - albertacowpoke

at 17:13 on May 9th, 2011

Income is normally taxed, except for DVA disability benefits. What is not known, is whether or not she is referring to a SISIP pension, which is a separate insurance plan, available to all service members. The 226,000 I assume was the death benefit she received from Veterans Affairs. She would have also received a Supplementary Death Benefit equal to two years salary. I would have to do some research to get the details of benefits for surviving spouses.

Karl Gotthardt - albertacowpoke

at 17:43 on May 9th, 2011

Here is a link of Canadian Forces Death Benefit as posted by the Chief Military Personnel. You will note in the chart that some benefits come as a result of the new Veterans Charter 2008, while others are part of Canadian Forces Regulations. Personally I think that those benefits are quite generous. Opinions?

http://www.cmp-cpm.forces.gc.ca/pub/cfp-bpf/6-07/dbrf-pdfr-eng.asp

foxy10935 (not verified)

at 17:56 on May 9th, 2011

I have just read your link for the benefits and I agree it generous, so really she has nothing to complain about.....in my opinion she is just looking for a way not to go to work....thanks for this link it explains it all very clearly.

Albert Milliron

at 19:30 on May 9th, 2011

Nice to see your story Karl! Yes, survivors benefits in Canada shouldn't be taxed but are, In America Social Security is taxed. Double and triple taxation is is a real issue and I hope your new conservative government looks into it.

Thanks for giving this woman a voice, a woman who has plenty of other issues on her mind than worrying about taxes and the repercussions if they are not paid.

I will say that the United States has dealt with this issue and has made sure that Disabled veterans and Survivor benefits are NOT taxed. For years folks were surprised by bills from the VA and hospital after a soldier died from injuries sustained in wartime. It took someone like you to write about it and let folks know what is happening to some of our most cherished people.

I worked for the VA, after my own Military Service, and was confronted with a quote from Abraham Lincoln on the entrance that reminded me of the reason I worked there,

" let us strive on to finish the work we are in, to bind up the nation's wounds, to care for him who shall have borne the battle and for his widow and his orphan"

Karl Gotthardt - albertacowpoke

at 19:48 on May 9th, 2011

Thanks very much for commenting Albert. I actually think overall we do a pretty good job of looking after Veterans, although you can't please everyone. Personally I liked the old monthly payment. Veterans Pensions are not taxed, neither is the lump sum payment survivors get.

The Pension she is talking about, I believe is the 60% of salary paid to a survivor by the Serviceman's Income Security Insurance Plan. This used to be voluntary but I believe has now become mandatory. If you look at the link provided you will see that there is also a military survivor benefit but it is means tested, as is our Old Age Security, which is an entitlement for all Canadian over age 65. The Canada Pension Plan is equal to your Social Security and you pay into it.

steffanileman

at 21:46 on May 9th, 2011

They shouldn't be taxed, if only because those people joined the military to defend Canada, not to be sent on a foreign adventure halfway around the world to serve multinational corporate interests.

Karl Gotthardt - albertacowpoke

at 02:10 on May 10th, 2011

steffanileman thank you kindly for your comments. It is always sad when a young life is lost and a young woman with an infant is made a widow. Afghanistan has certainly been an adventure, with the final chapter still to be written.