Revenu Québec Infos

In the Budget Speech of March 21, 2023, the Minister of Finance announced that changes would be made to the Act respecting the Québec Pension Plan so that workers 65 or older can stop contributing to the Québec Pension Plan (QPP) and workers over 72 are no longer required to contribute to the plan.

Introduction of an option to stop paying QPP contributions for workers 65 or older

As of January 1, 2024, workers 65 or older can choose to stop contributing to the QPP, provided they receive a QPP or Canada Pension Plan (CPP) retirement pension. This measure will promote job retention and offer greater financial flexibility. However, for workers who make this election, the retirement pension supplement, an additional amount their QPP contributions entitle them to, will no longer be added to their QPP retirement pension.

For employees, the election to stop making QPP contributions must be made using the Election to Stop Contributing to the QPP, or Revocation of an Election (form RR-50-V), which must be given to the employer and to Revenu Québec. The form will soon be available on Revenu Québec's website. Note that the election will also apply to the employer.

For self-employed workers or workers responsible for a family-type resource or an intermediate resource, the election to stop making QPP contributions must be made when they file their income tax return for the year.

Note that the election cannot come into effect before January 1, 2024.

End of the obligation to contribute to the QPP for workers over 72

As of 2024, the obligation to contribute to the QPP will cease for workers over 72, for all workers subject to the contribution provided for by the Act respecting the Québec Pension Plan.

Specifically, the obligation to contribute to the QPP for workers will cease as of the year they turn 73. Consequently, all wages paid and earnings received as of January 1 of the year a worker turns 73 will no longer be subject to QPP contributions.

For more information, see the Budget 2023-2024 – Additional information document on the Minister of Finance website.

In the Budget Speech of March 21, 2023, the Minister of Finance announced a general income tax cut for individuals as of the 2023 taxation year. Changes will be made to source deductions of income tax on remuneration paid after June 30, 2023.

Consequently, the Source Deduction Table for Québec Income Tax (TP-1015.TI-V), the Formulas to Calculate Source Deductions and Contributions (guide TP-1015.F-V), the Guide for Employers (TP-1015.G-V), the Source Deductions Return (TP-1015.3-V) and the WebRAS calculation tool will be updated for 2023. Since the changes will apply only as of July 1, 2023, the income tax reduction for the first part of 2023 will generally be calculated when individuals file their 2023 income tax return.

Reduction of the tax rates for the first two taxable income brackets for individuals

As of 2023, the tax rates for the first two taxable income brackets will drop from:

• 15% to 14% for taxable income up to $49,275;    
• 20% to 19% for taxable income over $49,275 but not more than $98,540.

Changes to personal tax credits Decrease in the conversion rate

As of 2023, the conversion rate for the amounts used to calculate personal tax credits will decrease from 15% to 14%.

Increase in the amounts used to calculate some personal tax credits

As of 2023, the amounts shown in form TP-1015.3-V that are used to calculate some personal tax credits will be increased. The amount for other dependants will increase from $4,810 to $5,154, and the amount for a child under 18 enrolled in vocational training or post-secondary studies (per term) will increase from $3,301 to $3,537. Source deductions of income tax on remuneration paid after June 30, 2023, must take these changes into account.

Reduction of the fixed rates for some payments

Since the rates for the first two taxable income brackets for individuals will be reduced, the fixed rates used to calculate source deductions on some payments and remuneration will be changed as well. This includes the payments and remuneration listed below that are made after June 30, 2023. 

Single payment under a registered retirement income fund (RRIF) or a registered retirement savings plan (RRSP)

The rate for the part of a single payment under a RRIF that exceeds the minimum amount or for a single payment under an RRSP will decrease from 15% to 14%.

Other single payments

The rate for a single payment not exceeding $5,000 that does not come from a RRIF or an RRSP will decrease from 15% to 14%. If the payment exceeds $5,000, the rate will drop from 20% to 19%.

The single payments covered by the rate reduction are as follows:

• retiring allowance payments;
• certain payments from a registered education savings plan (RESP);
• certain payments from a pension plan;
• a payment made under a deferred profit-sharing plan;
• a death benefit payment;
• an amount paid to an employee or a former employee pursuant to an order or judgment, where part of the amount paid relates to a previous year.

Payment under a government work-incentive project

The rate for an earnings supplement payment under some government work-incentive projects will decrease from 15% to 14%.

Assistance payment under a registered disability savings plan (RDSP)

The rate for the taxable portion of an assistance payment under an RDSP that exceeds $20,998 for 2023 will decrease from 15% to 14%.

Bonuses, retroactive payments and similar lump-sum payments

The rate for bonuses or retroactive payments paid to an employee whose estimated annual remuneration (including the bonus or payment) does not exceed $17,183 for 2023 will decrease from 8% to 7%.

Remuneration of self-employed fishers

The rate applied to the remuneration of individuals who fish otherwise than under an employment contract and who elected to have income tax deducted at source from their remuneration will decrease from 15% to 14%.

Payment under a program to obtain information relating to tax non-compliance

The rate for a payment under a federal or provincial program to obtain information relating to tax non-compliance will decrease from 20% to 19%.

Special tax on accumulated investment income from a registered education savings plan (RESP)

The special tax deduction rate of 8% in Québec on the accumulated investment income from an RESP is maintained so that the combined (federal and Québec) tax rate of 20% continues to apply to Québec residents.

For more information, see Budget 2023-2024: Additional Information (PDF – 1,418 KB) on the Ministère des Finances website.

In the Budget Speech of March 21, 2023, the Minister of Finance of Québec announced that the specific duty on new tires would increase on July 1, 2023, in part to help ensure the continuity of the Programme québécois de gestion intégrée des pneus hors d'usage (integrated scrap tire management program) administered by the Société québécoise de récupération et de recyclage (RECYC-QUÉBEC).

Since the cost of processing scrap car and truck tires varies according to their diameter, the specific duty of $3 will be increased to better reflect that fact. Thus, as of July 1, 2023, the specific duty on new tires will be increased to $4.50 for car tires and $6 for truck tires. The method for collecting, reporting and remitting the specific duty will stay the same.

See the table below for the amount of the specific duty on each tire with a rim diameter of 62.23 cm (24.5 in) or less in relation to its overall diameter.

Amount of specific duty by overall tire diameter Overall tire diameter Specific duty per new tire Application date 83.82 cm (33 in) or less $4.50 July 1, 2023 Over 83.82 cm (33 in) but not exceeding 123.19 cm (48.5 in) $6.00 July 1, 2023 123.19 cm (48.5 in) or less $3.00 Until June 30, 2023

For more information, see Additional Information: Budget 2023-2024 (PDF – 1.38 MB) on the Ministère des Finances website and Tires and Road Vehicles Subject to the Duty.

Lors du discours sur le budget fédéral du 19 avril 2021, une mesure visant à accorder un incitatif temporaire à l'investissement par la passation en charges immédiate a été annoncée. Cette mesure permet à une société privée sous contrôle canadien (SPCC) de bénéficier d'une déduction pour amortissement pouvant atteindre 100 % du coût en capital de certains biens pour l'année où ils deviennent prêts à être mis en service. Ces biens doivent, entre autres, être acquis après le 18 avril 2021 et devenir prêts à être mis en service avant 2024. Le montant de la déduction pour amortissement que peut demander une SPCC pour une année d'imposition, pour l'ensemble de ses biens relatifs à la passation en charges immédiate désignés (BPCID) devenus prêts à être mis en service dans cette année d'imposition, ne peut pas dépasser un plafond de 1,5 million de dollars.

Le 30 juin 2021, le ministère des Finances du Québec a annoncé l'harmonisation de la législation fiscale québécoise avec cette mesure dans le bulletin d'information 2021-5. Le 7 avril 2022, le ministère des Finances du Canada a présenté un avis de motion de voies et moyens (incluant un avant-projet de loi) prévoyant la mise en œuvre de la mesure relative à la passation en charges immédiate. En juin 2022, Revenu Québec a publié le formulaire Déduction pour amortissement à l'égard de biens relatifs à la passation en charges immédiate (CO-130.AD), qui permet à une SPCC d'effectuer les calculs relatifs à cette mesure.

Il y a donc eu un délai entre le moment où l'annonce de la mesure a eu lieu et le moment où les premiers textes légaux et le formulaire CO-130.AD permettant à une société d'appliquer cette mesure ont été rendus publics. Pour cette raison, Revenu Québec permettra à une société de modifier le montant de la déduction pour amortissement demandé à l'égard des biens relatifs à la passation en charges immédiate qui ont fait l'objet d'une désignation pour une année d'imposition se terminant après le 18 avril 2021 et avant le 1er janvier 2022. Les sociétés ont jusqu'au 31 décembre 2023 pour demander une telle modification à Revenu Québec.

Notez que cet allègement ne s'applique pas à un particulier ni à une société de personnes, car ils peuvent bénéficier de cette mesure uniquement depuis le 1er janvier 2022.

In the budget speech on March 21, 2023, the Minister of Finance of Québec announced a decrease in the tax rates applicable to the first two taxable income brackets of the personal income tax table. As of the 2023 taxation year, the rates will decrease: 

• from 15% to 14% for taxable income up to $49,275;
• from 20% to 19% for taxable income over $49,275 but not exceeding $98,540.

So that individuals can benefit from this tax cut in the 2023 taxation year, adjustments will be made to the methods of calculating source deductions of income tax that must be made on salaries and wages and on certain other amounts paid after June 30, 2023.

Instalment payments

To account for the general tax reduction for the 2023 taxation year, individuals who must pay their income tax in instalments can adjust the amount of their payments due after March 15, 2023, according to the usual rules.

Changes to personal tax credits Decrease in the conversion rate

Starting the 2023 taxation year, the conversion rate for the amounts used to calculate personal tax credits will drop from 15% to 14%, which corresponds to the new rate applicable to the first taxable income bracket of the personal income tax table. 

Increase in amounts granted for the purpose of calculating certain personal tax credits

As of the 2023 taxation year, the amounts granted for the purpose of calculating the personal tax credits in the table below have been increased.

Type of amount Amount granted (before budget) Income tax reduction at 15% conversion rate (before budget) Amount granted (after budget) Income tax reduction at 14% conversion rate (after budget) Amount for a child under 18 enrolled in post-secondary studies (per term) $3,301 $495 $3,537 $495 Amount for other dependants $4,810 $722 $5,154 $722 Amount transferred by a child 18 or over enrolled in post-secondary studies $11,795 $1,769 $12,638 $1,769 Reduction in the amount transferred by a child 18 or over enrolled in post-secondary studies when only term has been completed $3,301 $495 $3,537 $495

For more information, see Additional Information on the 2023-2024 Budget (PDF – 1,566 KB) on the Ministère des Finances website.

The limits and rates used to determine deductible automobile expenses and calculate taxable benefits relating to the use of an automobile for 2023 are as follows:

• The deductible limit for tax-exempt allowances paid by employers to employees is increased to $0.68/km for the first 5,000 kilometres travelled and $0.62/km for additional kilometres. For the Yukon, the Northwest Territories and Nunavut, the deductible limit for tax-exempt allowances paid by employers to employees is increased to $0.72/km for the first 5,000 kilometres travelled and $0.66/km for additional kilometres.
• The prescribed amount used to determine the value of the taxable benefit an employee receives for the personal portion of the operating costs of an automobile provided by his or her employer is increased to $0.33/km. For taxpayers whose main occupation is selling or leasing automobiles, the prescribed amount is increased to $0.30/km.
• The maximum capital cost of non zero-emission passenger vehicles for capital cost allowance purposes is increased to $36,000 (before GST and QST) for vehicles purchased after 2022.
• The maximum capital cost of eligible zero-emission passenger vehicles for capital cost allowance purposes is increased to $61,000 (before GST and QST) for vehicles purchased after 2022. Eligible zero-emission passenger vehicles include plug-in hybrids with a battery capacity of at least 7 kWh and vehicles that are fully electric or fully powered by hydrogen.
• The deductible limit for interest paid on amounts borrowed to purchase a passenger vehicle remains $300/month for loans related to vehicles purchased after 2022.
• The deductible limit for leasing expenses is increased to $950/month (before GST and QST) for leases entered into after 2022.

As part of the strategy for a tobacco-free Québec 2020-2025, the Ministère des Finances announced an increase in the tobacco tax from $29.80 to $37.80 per carton of 200 cigarettes. This $8 increase takes effect at 12:01 a.m. on February 9, 2023.

The table below shows the changes to the tobacco tax rates.

Product Rate in effect until February 8, 2023 Rate in effect starting February 9, 2023 Cigarettes $0.149 per cigarette $0.189 per cigarette Loose tobacco $0.149 per gram $0.189 per gram Leaf tobacco $0.149 per gram $0.189 per gram Tobacco sticks, rolls or other pre-rolled tobacco product

The higher of the following:

• $0.149 per stick, roll or other pre-rolled tobacco product
• $0.2292 per gram

The higher of the following:

• $0.189 per stick, roll or other pre-rolled tobacco product
• $0.2907 per gram

Other tobacco products $0.2292 per gram $0.2907 per gram

The tobacco tax rate applicable to cigars remains unchanged.

We will send retail vendors and collection officers that sell tobacco products a notice informing them of their obligations stemming from this increase, which includes completing form TAZ-7.12-V, Inventory of Tobacco Products in Stock.

For more information, see information bulletin 2023-2, available on the Ministère des Finances website.

Since January 1, 2023, the profit from flipping residential property (including rental property or a purchase option) you held for fewer than 365 consecutive days is fully taxable as business income. As a result, you are not eligible for the 50% capital gains inclusion rate or the principal residence exemption.

Situations when the rule does not apply

This rule does not apply if the property is sold due to one or more of the following life events:

• You or a related person dies.
• A related person joins your household (birth of child, adoption, or care of elderly parent) or you join a related person's household.
• Your marriage or common-law partnership breaks down (if you were living apart from your spouse for at least 90 days prior to the property's sale).  
• Your personal safety or a related person's personal safety is threatened (e.g. domestic violence).
• You or a related person has a disability or serious illness.
• You or your spouse or common-law partner works at a new location and your new residence is at least 40 km closer to the new work location.
• Your or your spouse's or common-law partner's employment is involuntarily terminated.
• You are insolvent.
• Your property is destroyed (e.g. natural disaster) or expropriated.

Even if the new rule does not apply because of the above events or because you held the property for fewer than 365 consecutive days, the profit may still be fully taxable if it is determined to be business income or a capital gain.

As announced by the Ministère des Finances, changes are being made to the senior assistance tax credit in order to improve the financial assistance offered to individuals age 70 or over.

Beginning in the 2022 taxation year, the maximum tax credit for an eligible senior age 70 or over without a spouse has been increased to $2,000. For a couple where both partners are eligible seniors, the maximum tax credit is $4,000. Tax credit payments will begin in spring 2023, once your income tax return for 2022 has been processed.

Maximum tax credit

The maximum tax credit for 2022 is:

• $2,000 for an eligible senior without a spouse whose family income is $24,195 or less (the credit is reduced by 5% above that threshold);
• $4,000 for a couple where both partners are eligible seniors and whose family income is $39,350 or less (the credit is reduced by 5% above that threshold).
• $2,000 for a couple where only one partner is an eligible senior and whose family income is $39,350 or less (the credit is reduced by 5% above that threshold).

Maximum family income

If your family income for 2022 is equal to or greater than the applicable maximum in the table below, you are not eligible for the tax credit.

Situation Maximum family income Eligible senior without a spouse $64,195 Eligible senior with an ineligible spouse $79,350 Couple of eligible seniors $119,350 Other changes

The following changes are also being made:

• The maximum tax credit will not be indexed annually.
• A new mechanism for revaluing the 5% reduction rate will be introduced in 2023.

For more information, see information bulletin 2022-7 on the Ministère des Finances website.

As announced by the Ministère des Finances, a new refundable cost of living tax credit has been created to help taxpayers in Québec deal with the rising cost of living caused by constantly increasing inflation. It will be paid out to eligible individuals who file their income tax return for 2021 by June 30, 2023, and whose net income for 2021 is less than $104,000.

Eligibility is based on your situation on December 31, 2021. Generally speaking, you must have been 18 or over, been resident in Québec and had an eligible residency status. If you turned 18 in 2022, you will be considered eligible if you meet the other requirements.

Amount of the credit Net income for 2021 Amount of the credit $50,000 or less $50,000 or less $600 $50,000 to $54,000 $400 to $599.99 (reduced by 5% of your income over $50,000) $54,000 to $100,000 $400 $100,000 to $104,000 $0 to $399.99 (reduced by 10% of your income over $100,000) Payment of the credit

The credit will be paid out to eligible individuals automatically. You do not need to claim it. If you file your 2021 income tax return by November 9, 2022, your credit will be paid out as early as December. If you file after that date (but before June 30, 2023), your credit will be paid out when your return is processed.

For more information, click New Refundable Cost of Living Tax Credit or see information bulletin 2022-6 on the Ministère des Finances website.

Note Important The formulas for calculating source deductions of income tax in the original Tax News article of August 11, 2022, were changed after its publication. This revised version includes the formulas harmonized with those published by the Canada Revenue Agency on October 22, 2022, in the Payroll Deductions Formulas (guide T4127). End of note

On March 16, 2022, the federal government published amendments to the Income Tax Regulations in the Canada Gazette. Under the amendments, which come into effect on January 1, 2023, additional employee contributions to the Québec Pension Plan (QPP) and the Canada Pension Plan (CPP) must be deducted from employment income when calculating the remuneration from which to withhold federal income tax.

In information bulletin 2022-3, published on April 29, 2022, the Ministère des Finances announced that the Regulation respecting the Taxation Act would be amended to include the changes to the Income Tax Regulations, with the necessary adjustments. These amendments also come into effect on January 1, 2023.

The formulas for calculating source deductions of income tax as of January 1, 2023, are shown below. The new formulas let you take into account employees' first additional QPP contribution when calculating the remuneration from which to withhold Québec income tax. 

Do not use these formulas for 2022. We are only publishing them so that employers can update their payroll systems for 2023.

The formulas for calculating source deductions of income tax and QPP contributions as of January 1, 2024, will be published at a later date so that you can take into account the second additional employee QPP contribution.

For more information, see guide TP-1015.F-V, Formulas to Calculate Source Deductions and Contributions.

Formulas for calculating source deductions of income tax Calculating source deductions of income tax for regular payments Regular payments Calculating the annual taxable income

I = annual taxable income

  = [P × (G − F − H − CSA)] − J − J₁ ► If the result is negative, enter 0.

New variable

CSA = additional employee QPP contributions on the employee's gross pensionable income for the pay period, excluding gratuities, retroactive pay or similar lump-sum payments

        = CS × [(S₃ − B₂) / S₃]

            where

            CS = additional employee QPP contributions for the pay period

                  = C × (0.01 / 0.0640)

                      where

                      C = employee QPP contribution for the pay period

            S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments

            B₂ = gratuities, retroactive pay or similar lump-sum payments made during the pay period

Gratuities, retroactive pay or similar lump-sum payments First method Calculating annual taxable income

I₁ = annual taxable income

   = (G₁ − F₁ − H₁ − CSA₁) + [Pr × (G − F − H₂ − CSA)] − J − J₁ ► If the result is negative, enter 0.

New variables

CSA₁ = total of the amounts included in variable CSA accrued before the start of the current pay period

CSA = additional employee QPP contributions on the employee's gross pensionable income for the pay period, excluding gratuities, retroactive pay or similar lump-sum payments

        = CS × [(S₃ − B₂) / S₃]

            where

            CS = additional employee QPP contributions for the pay period

                  = C × (0.01 / 0.0640)

                      where

                      C = employee QPP contribution for the pay period

            S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments

            B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period

Calculating income tax for the year

Y₁ = income tax for the year taking into account variable B₁

     = [T × (I₁ + B₁ − CSB₁)] − K − K₁ − (0.15 × E) − (0.15 × P × Q) − (0.15 × P × Q₁) ► If the result is negative, enter 0.

Y₂ = income tax for the year taking into account variables B₁ and B₂

     = [T × (I₁ + B₁ + B₂ − CSB₁ − CSB)] − K − K₁ − (0.15 × E) − (0.15 × P × Q) − (0.15 × P × Q₁) ► If the result is negative, enter 0.

New variables

CSB₁ = total of the amounts in variable CSB accrued before the start of the current pay period 

CSB = additional employee QPP contributions on gratuities, retroactive pay or similar lump-sum payments during the pay period

       = CS × (B₂ / S₃)

           where

           CS = additional employee QPP contributions for the pay period

                 = C × (0.01 / 0.0640)

                     where

                     C = employee QPP contribution for the pay period

           B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period

           S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments

Second method Calculating annual taxable income

I = annual taxable income

  = [P × (G − F − H − CSA)] + B₁ + B₂ − CSB₁ − CSB − J − J₁ ► If the result is negative, enter 0.

New variables

CSA = additional employee QPP contributions on the employee's gross pensionable income for the pay period, excluding gratuities, retroactive pay or similar lump-sum payments

         = CS × [(S₃ − B₂) / S₃]

             where

             CS = additional employee QPP contributions for the pay period

                   = C × (0.01 / 0.0640)

                       where

                       C = employee QPP contribution for the pay period

              S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments

              B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period

CSB₁ = total of the amounts included in variable CSB accrued before the start of the current pay period 

CSB = additional employee QPP contributions on gratuities, retroactive pay or similar lump-sum payments during the pay period

        = CS × (B₂ / S₃)

            where

            CS = additional employee QPP contributions for the pay period

                   = C × (0.01 / 0.0640)

                       where

                       C = employee QPP contribution for the pay period

           B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period 

           S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments 

Calculating source deductions of income tax for the pay period

A = source deductions of income tax on a gratuity, retroactive payment or similar lump-sum payment during the pay period 

    = T × (B₂ − CSB)

New variable

CSB = additional employee QPP contributions on gratuities, retroactive pay or similar lump-sum payments during the pay period 

         = CS × (B₂ / S₃)

             where

             CS = additional employee QPP contributions for the pay period

                   = C × (0.01 / 0.0640)

                       where

                       C = employee QPP contribution for the pay period

             B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period 

             S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments 

Calculating source deductions of income tax on a cumulative-averaging basis First method Calculating annual taxable income

I = annual taxable income

    = [S₁ × (G − F − H − CSA₁ − CSA)] + B − CSB₁ − CSB − J − J₁ ► If the result is negative, enter 0.

New variables

CSA₁ = total of the amounts included in variable CSA accrued before the start of the current pay period

CSA = additional employee QPP contributions on the employee's gross pensionable income for the pay period, excluding gratuities, retroactive pay or similar lump-sum payments

        = CS × [(S₃ − B₂) / S₃]

            where

            CS = additional employee QPP contributions for the pay period

                  = C × (0.01 / 0.0640)

                      where

                      C = employee QPP contribution for the pay period

            S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments

            B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period

CSB₁ = total of the amounts included in variable CSB accrued before the start of the current pay period 

CSB = additional employee QPP contributions on gratuities, retroactive pay or similar lump-sum payments during the pay period

        = CS × (B₂ / S₃)

            where

            CS = additional employee QPP contributions for the pay period

                  = C × (0.01 / 0.0640)

                      where

                      C = employee QPP contribution for the pay period

            B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period

            S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments 

Second method Calculating annual taxable income

I₃ = annual taxable income taking into account variable B₃

    = [S₁ × (G − F − H₁ − CSA₁ − CSA)] + B₃ − CSB₁ − CSB − J − J₁ ► If the result is negative, enter 0.

I₄ = annual taxable income taking into account variable B₄

    = [S₁ × (G − F − H₂ − CSA₁ − CSA)] + B₄ − CSB₁ − J − J₁ ► If the result is negative, enter 0.

New variables

CSA₁ = total of the amounts included in variable CSA accrued before the start of the current pay period

CSA = additional employee QPP contributions on the employee's gross pensionable income for the pay period, excluding gratuities, retroactive pay or similar lump-sum payments

        = CS × [(S₃ − B₂) / S₃]

            where

            CS = additional employee QPP contributions for the pay period

                  = C × (0.01 / 0.0640)

                      where

                      C = employee QPP contribution for the pay period

            S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments

            B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period

CSB₁ = total of the amounts included in variable CSB accrued before the start of the current pay period 

CSB = additional employee QPP contributions on gratuities, retroactive pay or similar lump-sum payments during the pay period

        = CS × (B₂ / S₃)

            where

            CS = additional employee QPP contributions for the pay period

                  = C × (0.01 / 0.0640)

                      where

                      C = employee QPP contribution for the pay period

            B₂ = gratuities, retroactive pay or similar lump-sum payments during the pay period 

            S₃ = employee's gross pensionable income for the pay period, including gratuities, retroactive pay or similar lump-sum payments 

On March 16, 2022, the federal government published amendments to the Income Tax Regulations in the Canada Gazette. Under the amendments, which come into effect on January 1, 2023, additional employee contributions to the Québec Pension Plan (QPP) and the Canada Pension Plan (CPP) must be deducted from employment income when calculating the remuneration from which to withhold federal income tax.

In information bulletin 2022-3, published on April 29, 2022, the Ministère des Finances announced that the Regulation respecting the Taxation Act would be amended to include the changes to the Income Tax Regulations, with the necessary adjustments. These amendments also come into effect on January 1, 2023.

The formulas for calculating annual taxable income as of January 1, 2023, are shown below. The new formulas let you take into account employees' first additional QPP contribution when calculating the remuneration from which to withhold Québec income tax. 

Do not use these formulas for 2022. We are only publishing them so that employers can update their payroll systems for 2023.

The formulas for calculating annual taxable income and QPP contributions as of January 1, 2024, will be published at a later date so that you can take into account the second additional employee QPP contribution.

For more information, see guide TP-1015.F-V, Formulas to Calculate Source Deductions and Contributions.

FORMULAS FOR CALCULATING ANNUAL TAXABLE INCOME Calculating source deductions of income tax for regular payments Regular payments

Calculating the annual taxable income

I      =     annual taxable income 

       =     P × (G − F − H − CS) − J − J₁

New variable

CS  =   additional employee QPP contributions for the pay period

       =   C × (0.01/0.0640)

            where

            C  =   employee QPP contribution for the pay period

Gratuities, retroactive pay or similar lump-sum payments

First method

Calculating the annual taxable income

I₁     =     annual taxable income

        =     (G₁ − F₁ − H₁ − CS₁) + [Pr × (G − F − H₂ − CS)] − J − J₁

New variables

CS₁ =   total of the amounts included in variable CS accrued before the start of the current pay period  

CS  =   additional employee QPP contributions for the pay period

       =   C × (0.01/0.0640)

            where

            C  =   employee QPP contribution for the pay period

Second method

Calculating the annual taxable income

I      =     annual taxable income

       =     P × (G − F − H − CS) + B₁ + B₂ − J − J₁

New variable

CS  =   additional employee QPP contributions for the pay period

       =   C × (0.01/0.0640)

             where

             C  =   employee QPP contribution for the pay period

Calculating source deductions of income tax on a cumulative-averaging basis

First method

Calculating the annual taxable income

I      =     annual taxable income

       =     S₁ × [G − F − H − (CS₁ + CS)] + B − J − J₁

New variables

CS₁ =   total of the amounts included in variable CS accrued before the start of the current pay period

CS  =   additional employee QPP contributions for the pay period

       =   C × (0.01/0.0640)

             where

             C  =   employee QPP contribution for the pay period

Second method

Calculating the annual taxable income

I₃      =     annual taxable income taking into account variable B₃

         =     S₁ × [G − F − H₁ − (CS₁ + CS)] + B₃ − J − J₁

I₄      =     annual taxable income taking into account variable B₄

         =     S₁ × [G − F − H₂ − (CS₁ + CS)] + B₄ − J − J₁

New variables

CS₁ =   total of the amounts included in variable CS accrued before the start of the current pay period

CS  =   additional employee QPP contributions for the pay period

       =   C × (0.01/0.0640)

             where

              C  =   employee QPP contribution for the pay period

Under section 93.1.1 of the Tax Administration Act (TAA), you can object to an assessment under a fiscal law by filing a written notice of objection. The notice must set out the reasons for the objection and the relevant facts, and it must be filed no later than 90 days following the date the notice of assessment was sent.

In accordance with section 93.1.6 of the TAA, when we receive a notice of objection, we begin by thoroughly re-examining the assessment. We then either cancel, confirm or amend the original assessment or issue a reassessment, and we send our decision by mail.

After filing an objection, you may wish to withdraw it for various reasons. For example, you might realize that the assessment was accurate. Or, our examination of the reasons for the objection might reveal an error in the contested part of the assessment that results in an increase in the duties payable.

However, according to case law, objecting to an assessment is part of the assessment process, which does not end until we have determined the definitive amount of the tax liability, either by issuing a reassessment or by cancelling, confirming or amending the original assessment.

As a result, you cannot withdraw your objection to avoid a greater assessment or because you no longer want to continue the objection process—the objections officer tasked with making a decision on the objection must re-examine the assessment and either cancel, confirm or amend it or make a reassessment, in accordance with section 93.1.6 of the TAA.

Likewise, even if you decide to withdraw your objection because you agree that the assessment is accurate and you have no other arguments to make, the objections officer will nonetheless re-examine the assessment. In most cases, they will confirm it. However, if they discover an error that results in an increase or decrease in the contested duties, they will amend the assessment to correct the error.

Our objection process is the same as that used by the Canada Revenue Agency. What's more, going through the full process is a prerequisite for filing a contestation before the Court of Québec under section 93.1.10 of the TAA.

Note

Generally speaking, a decision increasing the amount of an assessment can only be made during the regular assessment period. However, such a decision can be made outside this period under section 25.1 of the TAA, paragraph (b) of subsection (2) of section 1010 of the Taxation Act or subsection 298(4) of the Excise Tax Act. That said, the decision to increase an assessment is an exceptional measure and can only be made if, while examining the reasons for the objection, the information in the file or newly revealed or submitted facts, the objections officer discovers an error in the contested part of the assessment.

End of note

As announced in the budget speech of March 22, 2022, a new one-time refundable tax credit has been created to help individuals deal with the rising cost of living. It will be paid out to eligible individuals who file an income tax return for 2021 and whose net income for the year is less than $105,000.

Eligibility is based on your situation on December 31, 2021. To be eligible, you must have been 18 or over, been resident in Québec and had an eligible residency status.

Amount of the credit

If your net income for 2021 was $100,000 or less, you will receive a $500 tax credit.

If your net income for 2021 was between $100,000 and $105,000, the $500 will be reduced by 10% of the part of your net income that exceeds $100,000.

Payment of the credit

If you are eligible, the new credit will be paid out automatically when we process your 2021 income tax return. You do not have to claim it. If you have already filed your return, you will receive the credit by the end of May 2022.

For more information on the new credit, click Special One-Time Cost of Living Tax Credit or see the Additional Information on the 2022-2023 budget on the Ministère des Finances website.

The limits and rates used to determine deductible automobile expenses and calculate taxable benefits relating to the use of an automobile for 2022 are as follows:

• The deductible limit for tax-exempt allowances paid by employers to employees is increased to $0.61/km for the first 5,000 kilometres travelled and $0.55/km for additional kilometres. For the Yukon, the Northwest Territories and Nunavut, the deductible limit for tax-exempt allowances paid by employers to employees is increased to $0.65/km for the first 5,000 kilometres travelled and $0.59/km for additional kilometres.
• The prescribed amount used to determine the value of the taxable benefit an employee receives for the personal portion of the operating costs of an automobile provided by his or her employer is increased to $0.29/km. For taxpayers whose main occupation is selling or leasing automobiles, the prescribed amount is increased to $0.26/km.
• The depreciable value of non zero-emission passenger vehicles for capital cost allowance purposes is increased to $34,000 (before GST and QST) for vehicles purchased after 2021.
• The depreciable value of eligible zero-emission passenger vehicles for capital cost allowance purposes is increased to $59,000 (before GST and QST) for vehicles purchased after 2021. Eligible zero-emission passenger vehicles include plug-in hybrids with a battery capacity of at least 7 kWh and vehicles that are fully electric or fully powered by hydrogen.
• The deductible limit for interest paid on amounts borrowed to purchase a passenger vehicle remains $300/month for loans related to vehicles purchased after 2021.
• The deductible limit for leasing expenses is increased to $900/month (before GST and QST) for leases entered into after 2021. A separate restriction prorates deductible leasing expenses when the value of the passenger vehicle exceeds the depreciable value.

The Québec government recently passed the Act to modernize the occupational health and safety regime, which requires new categories of employers to pay the contribution related to labour standards and adjusts the contribution rate for employers that are currently subject to the contribution.

Beginning in 2022

• The contribution rate for employers that are currently subject to the contribution will go from 0.07% to 0.06%.
• New categories of employers will be required to pay the contribution related to labour standards. Depending on the category, their contribution rate will be:
  • the regular 0.06% rate; or
  • a reduced rate of 0.02% in 2022, 0.03% in 2023 and 0.05% in 2024.

Beginning in 2025, the rate will be the same for all employers.

To learn more about calculating and paying the contribution or about the new employer categories required to pay it, see Contribution related to labour standards at Principal Changes for 2022.

The Ministère des Finances has announced a new refundable tax credit to help offset the part of the increase in the cost of living that is not covered by the indexation of the tax system. To be eligible for it, you must be eligible for the solidarity tax credit for the period from July 1, 2021, to June 30, 2022, because you met the requirements on December 31, 2020.

The new credit is a lump sum of:

• $200 for an eligible individual; or
• $275 for an eligible individual living alone.

Unlike the solidarity tax credit, the new one-time credit is not reduced on the basis of your family income.

You do not have to claim the new credit. Payments will be made automatically beginning on January 24, 2022.

To receive the new credit, you must file your 2020 income tax return by December 31, 2021, or you must have been receiving last-resort financial assistance on December 31, 2020. Filing your 2020 return by December 31, 2021, is also the only way to make sure you get the full amount you are entitled to.

For more information, see information bulletin 2021-8 on the Ministère des Finances website.

To help families with high unsubsidized childcare expenses, the Ministère des Finances has announced changes to the refundable tax credit for childcare expenses. 

Increased tax credit rates

The tax credit rate brackets have been adjusted. The rates for 2021 are shown in the table below.

Family income ($) Tax credit rate (%) more than not more than - 21,000 78 21,000 37,030 75 37,030 38,400 74 38,400 39,780 73 39,780 41,135 72 41,135 42,515 71 42,515 101,490 70 101,490 or more 67 Increased expense limits

Certain childcare expense limits have been increased as of 2021.

• For a child who is under 7 at the end of the year, the limit has been increased from $9,825 to $10,400.
• For a child with a severe and prolonged impairment in mental or physical functions, the limit has been increased from $13,445 to $14,230.

Advance payments

Advance payments for 2021 will not be adjusted to reflect the changes. However, the rate and expense limit increases will be taken into account in the 2021 income tax return.

For more information, see information bulletin 2021-8 on the Ministère des Finances website. The website also has a tool for calculating the net daily cost of your childcare services.

The Ministère des Finances du Québec recently announced changes to the tax credit for the treatment of infertility to better complement the Québec health insurance plan and improve access to financial assistance for would-be parents.

The main changes are the following:

• Certain eligibility requirements have been eliminated.
• Expenses for an unlimited number of in vitro fertilization cycles are now eligible.
• Expenses paid for certain artificial insemination treatments are now eligible.

Eliminated requirements

The following three requirements no longer apply in respect of in vitro fertilization expenses paid after November 14, 2021:

• Neither you nor your spouse had a child before the start of the in vitro fertilization treatment for which the expenses were paid.
• A physician certifies that neither you nor your spouse underwent surgical sterilization by vasectomy or tubal ligation for reasons that are not strictly medical.
• The expenses are attributable to no more than a single in vitro fertilization cycle in the case of a woman age 36 or under, and to no more than two cycles in the case of a woman age 37 or over.

Artificial insemination treatments

Expenses paid after November 14, 2021, for certain artificial insemination treatments are now eligible.

To learn more about the changes, see information bulletin 2021-7 on the Ministère des Finances website.

The Act to amend the Taxation Act, the Act respecting the Québec sales tax and other provisions (S.Q. 2021, c.18) was given assent on June 4, 2021.

It sets a deadline for dealers that are large business and that made motor vehicles available to their employees or shareholders from 2018 to 2020 but did not report the QST on the resulting benefits. The deadline is October 31, 2021. Interest and penalties apply after that date.

For more information, click Use Of Courtesy Or Demonstration Vehicles.