An honorarium is an ex gratia payment, i.e., a payment made, without the giver recognizing themselves as having any liability or legal obligation , to a person for his or her services in a volunteer capacity or for services for which fees are not traditionally required. It is a common remuneration practice in schools or sports clubs , for teachers and coaches. [1] [2] [3] Another example includes the payment to guest speakers at a conference meeting to cover their travel, accommodation, or preparation time.
An example of this is the payments made by Australian schools to their sporting coaches. [9] They are ostensibly receiving a reimbursement for their costs in their voluntary roles as coaches. The concept of an honorarium has a tax implication. In Australia, recipients of these funds make a tax declaration (known as the hobbyist form) [10] to the tax office and therefore do not have to include this money in their annual tax return .
In Canada, honoraria are considered salary and thus, taxable income under the Income Tax Act . [11] In the case where a gift is substituted for honorarium (gift in lieu of money), it is still classified as a taxable benefit by Canada Revenue Agency . [11]