By the end of February each year, your employer sends you a T4 slip, the Statement of Remuneration Paid. This document is the official summary of your earnings and the deductions your employer made on your behalf during the previous tax year. Think of it as the foundational document for reporting your employment income to the Canada Revenue Agency (CRA).

While the T4 has many boxes, a few are critical for your tax return. The most important is Box 14, “Employment income,” which shows your total earnings before any deductions. This figure includes your regular pay, bonuses, and any taxable benefits you received, such as company car usage or certain health insurance premiums.

Next, look at Box 22, “Income Tax Deducted.” This is the total amount of federal and provincial income tax your employer withheld from your paycheques throughout the year. These are prepayments on your total tax bill.

Finally, you'll see boxes for contributions to national social security programs: Box 16 for Canada Pension Plan (CPP) contributions and Box 18 for Employment Insurance (EI) premiums. Your employer also contributes on your behalf. These contributions determine your eligibility for benefits later and also generate non-refundable tax credits.

Filing your taxes involves transferring the numbers from your T4 slips to your T1 General Income Tax and Benefit Return. Most tax software does this automatically, but understanding the flow is key. The amount from Box 14 on all your T4 slips is summed up and reported on line 10100 of your T1 return. This becomes the starting point for calculating your total income.

The income tax you've already paid, found in Box 22, is entered on line 43700, “Total income tax deducted.” This amount is subtracted from your calculated total tax owing at the end of the process. If you've paid more than you owe, you get a refund; if you've paid less, you'll have a balance owing.

Your CPP and EI contributions (Boxes 16 and 18) are used to calculate non-refundable tax credits, which reduce your tax liability. For example, your total CPP contributions are entered on line 30800 of your Schedule 1.

Beyond the basic numbers, your T4 can unlock specific deductions and credits that lower your taxable income.

If you pay union dues or professional fees required for your job, your employer will report this amount in Box 44 of your T4. You can deduct this full amount on line 21200 of your T1 return. This is a valuable deduction because it directly reduces your income, potentially lowering you into a more favourable tax bracket.

Another automatic benefit is the Canada employment amount, a non-refundable tax credit for all employees. For the 2025 tax year, you can claim a credit on an amount up to $1,433. You don't need to apply for it; tax software calculates it automatically based on the income you report on line 10100. It's designed to help cover small work-related expenses like uniforms and supplies that aren't otherwise reimbursed.

When you have all the information from your T4 slips correctly entered, you'll have a clear picture of your employment income and the tax you've already paid, setting the stage for the rest of your tax return.