You do not need to link taxable benefit to anything or create new benefit lines if the employees are not paying any portion of the premium from their paychq.

All you need to do is enter 25.00 in the 'Benefit' line. Sage 50 will add 25.00 to income, calculate the taxes, then deduct 25.00 from income automatically. Go ahead with posting the full 700.00 amount to your Employee Group Benefit 5000 Acct. You can let your employees know that the taxable benefit amount is for the Life and AD&D portion of benefit plan so that they know what is happening.

what if the employee IS paying for the premium in part or in full.  What setup and emtry is required then.  this needs to happen in the case of critical illness policies so that the benefits of the policy should they be exercised remain tax free in the hands of the employy

Thank you, your answer sent me in the right direction.  I did create a separate benefit account in payroll and linked to to wages.  I could not use the system benefit as I did not want it to calculate the EHT which the system does automatically.

Critical Illness and LTD (and AD&D??) needs to be paid in full by employees in order to get income tax free should they ever need it. If employees are paying 50% of premium then you can allocate employEE paid 50% to cover all of  the taxable portion that is dependent on tax free income and then the rest of percentage left would cover the non-taxable benefits. This would casue the employER portion to cover only the non-taxable portion of benefits. If you find the taxable benefit portion is more than the 50% of employEE portion you may want to discuss with employees to see if they want to up their percentage to cover the taxable portion. It has been my experience in discussions with various benefit plan providers that the portion paid by employees can be any combination of the individual benefits as along as the total adds to the correct percentage - in other word it is NOT 50% AD&D, 50% CI, 50% LTD, 50% Vision etc etc but rather it is 50% of the total benefitt premium.