Revenu Québec Infos

The Ministère des Finances has announced that the tax credit for interest on a loan granted by a seller-lender and guaranteed by La Financière agricole du Québec will be extended for five years.

An eligible taxpayer may be entitled to the tax credit if it was granted a loan further to an agreement entered into after December 2, 2014, but before January 1, 2025.

The tax credit is equal to 40% of the interest paid on the loan that is attributable to the portion of the eligibility period included in the taxpayer's taxation year.

The eligibility period begins on either January 1, 2015, or the day on which the loan agreement was entered into, whichever is later. The end date of the period is 10 years after the day on which the loan agreement was entered into.

A taxpayer that is a member of a partnership can also claim the tax credit.

For more information, see information bulletin 2019-11 published by the Ministère des Finances.

The Ministère des Finances has announced that the tax credit relating to information technology integration will be extended for another year.

The rate of the tax credit is 20%. It is calculated on 80% of expenditures relating to the supply of a qualified management software package and to an information technology (IT) integration contract for which Investissement Québec has issued a certificate. The rate is reduced linearly if the qualified corporation's paid-up capital is between $35 million and $50 million. It is 0% if the corporation's paid-up capital is $50 million or more.

For the duration of the tax credit, the total amount that a qualified corporation can receive regarding one or more eligible IT integration contracts is limited to $50,000.

For a qualified corporation to claim the tax credit, expenditures relating to the supply of a qualified management software package must be incurred before January 1, 2020, and an application for a certificate regarding an eligible IT integration contract must be submitted to Investissement Québec prior to that date.

A corporation that is a member of a partnership can also claim the tax credit.

For more information, see information bulletin 2019-11 published by the Ministère des Finances.

The Québec parental insurance plan (QPIP) maximums, threshold and rates for 2020 are as follows:

• The maximum insurable earnings have been increased from $76,500 to $78,500.
• The qualifying threshold remains $2,000.
• The employee premium rate has been decreased from 0.526% to 0.494%.
• The employer premium rate has been decreased from 0.736% to 0.692%.
• The maximum employee premium has been decreased from $402.39 to $387.79.
• The maximum employer premium has been decreased from $563.04 per employee to $543.22.
• The premium rate for self-employed persons and persons responsible for a family-type resource or an intermediate resource has been decreased from 0.934% to 0.878%.
• The maximum premium for a self-employed person or a person responsible for a family-type resource or an intermediate resource has been decreased from $714.51 to $689.23.

The table below shows the QPP maximums, exemption and contribution rates for 2019 and 2020.

2019 2020 Maximum pensionable earnings $57,400 $58,700 Basic exemption $3,500 $3,500 Maximum contributory earnings $53,900 $55,200 Employee and employer 2019 2020 Base contribution rate 5.40% 5.40% First additional contribution rate 0.15% 0.30% Contribution rate for the year 5.55% 5.70% Maximum base contribution $2,910.60 $2,980.80 Maximum first additional contribution $80.85 $165.60 Maximum annual contribution $2,991.45 $3,146.40 Self-employed person and person responsible for a family-type resource or an intermediate resource 2019 2020 Base contribution rate 10.80% 10.80% First additional contribution rate 0.30% 0.60% Contribution rate for the year 11.10% 11.40% Maximum base contribution $5,821.20 $5,961.60 Maximum first additional contribution $161.70 $331.20 Maximum annual contribution $5,982.90 $6,292.80

As announced in information bulletin 2019-9, the Ministère des Finances has extended the tax credit to support the digital transformation of print media companies for one year. 

The tax credit is intended mainly for eligible corporations that hold a qualification certificate issued by Investissement Québec for a taxation year. The qualification certificate must certify that the corporation produced and disseminated a print or digital information media including original written information content in that taxation year.

The tax credit is equal to 35% of the eligible digital conversion costs that the corporation incurred for the taxation year. The costs cannot exceed $20 million for the year. 

The eligible digital conversation costs must be incurred after March 27, 2018, but before January 1, 2024, except if they concern qualified property acquired under an eligible digital conversion contract. In this case, the qualified property must be acquired before January 1, 2023.

An eligible corporation that holds a qualification certificate issued by Investissement Québec for a taxation year can claim the tax credit to support print media companies if it meets certain conditions. The qualification certificate must certify that, in that taxation year, the corporation produced and disseminated a print media with original written information content, such as a print publication, an information website or a mobile application dedicated to information. 

The tax credit is equal to 35% of the qualified wages the corporation incurred in the taxation year after December 31, 2018, for all eligible employees. However, an employee's annual qualified wages cannot exceed $75,000.  

A corporation that is a member of an eligible partnership can claim the tax credit for its share of the qualified wages incurred by the partnership for its fiscal period ended in the corporation's taxation year.

For more information, see information bulletin 2019-9 published by the Ministère des Finances.

Generally speaking, you only need to report fees and other amounts paid to self-employed individuals in box O (code RD) of the RL-1 slip if you withheld Québec income tax on them.

However, beginning with the 2020 taxation year, you will have to report fees and other amounts paid to self-employed individuals for building service work performed inside or outside a public building in box O (code RD) of the RL-1 slip even if you did not withhold Québec income tax on them.

This change only concerns work and public buildings defined in the Decree respecting building service employees in the Québec region and the Decree respecting building service employees in the Montréal region.

This new requirement applies to RL-1 slips filed for 2020 onward.

Under Québec's tax system, taxpayers are responsible for assessing, reporting and paying their income tax. However, for some social assistance recipients, this is difficult and may make it hard for them to receive the solidary tax credit.

The tax legislation will therefore be amended so that individuals who meet the following requirements can receive the basic amount of the Québec sales tax (QST) component of the credit without filing an income tax return:

• they received benefits under the Social Assistance Program, the Social Solidarity Program or the Aim for Employment Program for the month of December; and
• they had yet to file an income tax return by September 1 of the following year.

The $292 basic amount for the period from July 2019 to June 2020 will be paid by June 2020.

Despite this new measure, it is important to remember that filing an income tax return is the only way for taxpayers to receive all the benefits they are entitled to. Free help completing their returns is available through the Income Tax Assistance — Volunteer Program.

On November 7, 2019, the Minister of Finance of Québec announced the elimination of the additional contribution for subsidized educational childcare for all families as of 2019. As a result, you will no longer receive RL-30 slips.

If you had your income tax withholdings adjusted to help pay your additional contribution when you file your income tax return, the additional amount withheld for 2019 will be used to either reduce your income tax payable or increase your refund, as applicable.

To change the adjustment, complete one of the following forms and give it to your employer:

• Source Deductions Return (TP-1015.3-V)
• Request to Have Additional Income Tax Withheld at Source (TP-1017-V)

So that the rules for collecting the tax on lodging better fit the reality of today's digital and sharing economies, Québec's Finance Minister announced new obligations for operators of digital accommodation platforms in the 2019–2020 budget speech delivered on March 21, 2019. Beginning on January 1, 2020, operators of digital accommodation platforms that receive an amount as consideration for the rental of a unit in a sleeping-accommodation establishment that is subject to the tax on lodging must:

• register for the tax on lodging;
• collect a 3.5% tax on the price of every overnight stay; and
• report and remit the tax on lodging they collected in each tourism region by the last day of the month following the end of a calendar quarter.

The operator of a digital accommodation platform is a person who, via the platform:

• brings together the supplier of an accommodation unit (for example, a hotel) and the recipient (for example, an individual renting a hotel room);
• provides a framework for interactions between the supplier and the recipient; and
• manages the financial transactions between the supplier and the recipient.

Note that the tax on lodging currently applies in all of Québec's tourism regions except Nunavik.

For more information, write to Contact-PNH@revenuquebec.ca or call us at 1 833 372-3850 (toll-free in Canada and the U.S.) or 1 819 348-9735 (charges apply).

Further to the passage of Bill 37, the Act mainly to establish the Centre d'acquisitions gouvernementales and Infrastructures technologiques Québec, businesses that are imposed a penalty further to a final assessment based on the general anti-avoidance rule (GAAR) as well as the promoters of the transactions in question on whom a GAAR-based penalty has been imposed, will now be listed in the Registre des entreprises non admissibles aux contrats publics (RENA) for five years. The Act respecting contracting by public bodies will be amended to provide that the listing also apply to businesses related to a person that has been imposed a GAAR-based penalty.

Moreover, the penalties imposed will be taken into account by the Autorité des marchés publics when it comes to deciding whether or not to authorize a business to enter into contracts with a public body.

If you make a late preventive disclosure by duly completing and filing the form by the deadline, you will avoid:

• incurring GAAR-based penalties with respect to the disclosed transaction;
• being listed in the RENA.

As of now, you can send us a late preventive disclosure form for a transaction or a series of transactions, even though the deadline for making the disclosure under section 1079.8.10 of the Taxation Act has expired, as long as we receive your disclosure within 60 days of the passage of Bill 37. To make a late preventive disclosure, file form TP-1079.DI-V, Mandatory or Preventive Disclosure of Tax Planning, with a letter explaining that the form is being filed as a late preventive disclosure, in accordance with section 44 of Bill 37.

Late preventive disclosures for a transaction or a series of transactions for which a Revenu Québec or a Canada Revenue Agency audit has already begun will not be accepted.

For more information, see Bill 37.

If you are an employer whose remittance frequency is weekly or twice-monthly, Revenu Québec will accept that you remit the source deductions and employer contributions for the last period of December before January 16 of the following year, without penalty. However, you will have to pay interest, calculated as of the remittance date according to your remittance frequency.

This administrative policy will apply as of 2019. The first remittance covered by this policy will be the one for the last period of December 2019.

As stated in information bulletin 2019-5, which was published on May 17, 2019, the parties to a nominee agreement made as part of a transaction or series of transactions have the obligation to disclose it to Revenu Québec by filing an information return.

The return must be filed by:

• the 90th day following the date the nominee agreement was concluded, if it was concluded on or after May 17, 2019; or
• September 16, 2019, if the nominee agreement was concluded before May 17, 2019, and the tax consequences of the transaction or series of transactions to which the nominee agreement relates continue on or after May 17, 2019.

For more information, see information bulletin 2019-5.

Filing deadline extension

To maximize compliance with the new obligation, Revenu Québec is extending the deadline for filing the information returns from September 16, 2019, or the 90th day following the conclusion of the nominee agreement, to the later of the following dates:

• the 90th day following the conclusion of the nominee agreement; or
• the 90th day following the day the bill introducing the new measures receives assent.

If you pay referees, scorekeepers or evening staff (whether self-employed or employees) for sports activities, you may be able to deduct those payments from your income as business expenses.

If the referee, scorekeeper or evening staff member is self-employed, you could be entitled to input tax credits (ITCs) and input tax refunds (ITRs) for taxable services the person provides, if he or she is a registered supplier.

However, if you are the employer of a referee, scorekeeper or evening staff member, you must make source deductions on the person's salary or wages and pay employer contributions. You must also issue your employee an RL-1 slip.

Both the self-employed person and employee must report the income.

For more information on determining whether someone is an employee or self-employed, refer to document IN-301-V, Employee or Self-Employed Person?

Beginning September 1, 2019, certain suppliers outside Québec and operators of specified digital platforms that are registered for the GST/HST must register for the QST and collect the QST on certain taxable supplies they make in Québec and remit it to us.

Suppliers outside Québec that are registered for the GST/HST: mandatory QST registration beginning September 1, 2019

These suppliers must collect the QST on taxable supplies of corporeal moveable property, incorporeal moveable property or services they make in Québec to people whose usual place of residence is Québec and who are not registered for the QST.

Registration is mandatory for suppliers that meet the following conditions:

• They do not have any establishments in Québec, nor do they carry on a business in Québec.
• They are not currently registered for the QST.
• They make more than $30,000 per year in supplies of services to consumers in Québec, other than supplies of services and incorporeal movable property made through specified digital platforms.
• They supply corporeal moveable property, incorporeal moveable property or services to consumers in Québec who are not registered for the QST and whose usual place of residence is in Québec.

Operators of specified digital platforms are subject to similar rules.

Another similar measure, which has been in effect since January 1, 2019, applies to certain suppliers and operators of specified digital platforms that are located outside Canada and are not registered for the GST/HST.

A major step towards ensuring tax fairness!

The taxation of e-commerce currently represents a major challenge for Revenu Québec, in part due to the ever-increasing number of online transactions conducted. The new government measure is therefore entirely consistent with our commitment of taking concrete action to deal with these new taxation challenges and to working actively to ensure tax fairness in all areas.

For more information, go to the Suppliers Outside Québec section of our website.

The limits and rates for the deduction of automobile expenses and the calculation of the taxable benefits related to the use of an automobile for 2019 are as follows:

• For purposes of capital cost allowance (CCA), the maximum capital cost of passenger vehicles remains unchanged at $30,000 (plus GST and QST) for vehicles purchased after 2018. 
• The limit on the deduction of leasing costs remains unchanged at $800 per month (plus GST and QST) for leases entered into after 2018. Under a separate restriction, deductible leasing costs are prorated where the value of the passenger vehicle exceeds the maximum capital cost. 
• The limit on the deduction of tax-exempt allowances paid by employers to employees using their personal vehicle for business purposes increased to 58 cents per kilometre for the first 5,000 kilometres and 52 cents for each additional kilometre. 
• The limit on the deduction of interest paid on amounts borrowed to purchase a passenger vehicle remains unchanged at $300 per month for loans related to vehicles acquired after 2018. 
• The prescribed rate used to determine the taxable benefit respecting the portion of operating expenses which relates to an employee's personal use of an automobile provided by the employer has been increased to 28 cents per kilometre. For taxpayers employed principally in selling or leasing automobiles, the prescribed rate has been increased to 25 cents per kilometre.

Employees generally have to repay employers the gross amount of any employment income received by mistake if they repay the amount in a different year than it was received. They also have to recover the excess income tax, Québec Pension Plan (QPP) contributions and Québec parental insurance plan (QPIP) premiums that were deducted from Revenu Québec.

However, effective January 15, 2019, employees can, under certain conditions, repay employers only the net amount of any employment income received by mistake (gross income they received by mistake minus source deductions), even if they repay the amount in a different year than it was received. In this situation, we will reimburse the employer, rather than the employee, any source deductions the employer made on the amount paid by mistake.

Note that employees can, under certain conditions, repay employers the net amount of any employment income received by mistake if they repay the amount in the same year it was received by mistake. For more information, see the Guide to Filing the RL-1 Slip: Employment and Other Income (RL-1.G-V).

Conditions

An employee can repay an employer the net amount of any employment income received by mistake if the following conditions are met:

• The employment income was received by mistake because of a clerical, administrative or system error.
• The employment income was received by mistake after 2015.
• The employer has not yet filed an RL-1 slip for the employee showing the employee's actual employment income (the gross income paid in the year minus the gross income paid by mistake).
• The employee has repaid the net amount or made an arrangement with the employer to repay the amount by December 31 of the third year after the year in which the employment income was received by mistake.

If these conditions are not met, the employee has to repay the employer the gross amount of any employment income the employee received by mistake in a previous year. For more information, see the RL-1.G-V guide.

Calculating the net amount of employment income paid by mistake in a previous year

The net amount is equal to the employment income paid by mistake in a previous year, minus:

• Québec income tax withheld on the income paid by mistake (if the employer has made an election);
• QPP contributions deducted from the income paid by mistake (if the employer has made an election);
• QPIP premiums deducted from the income paid by mistake (if the employer has made an election).

Employers must make a separate election for each type of deduction made under a Québec law, regardless of their election for each type of deduction under a federal law. They must make the election by December 31 of the third year after the year in which the employment income was paid by mistake.

Instructions for employers

To be refunded source deductions and employer contributions in a situation in which an employee repays the net amount of employment income received by mistake, employers have to:

• send us an amended RL-1 slip and RL-1 summary for the year in which they paid the amount to the employee by mistake;
• give the employee an amended RL-1 slip for the year in which they paid the amount by mistake.

The following information must be entered on the amended RL-1 slip: 

• in the “Code du relevé” box, the letter A;
• in the “No du dernier relevé transmis” box, the number shown in the upper right-hand corner of the slip being amended;
• in box A, the actual employment income (the employment income paid in the year, minus the gross income paid by mistake);
• in boxes G and I, the actual pensionable and eligible salary or wages (that is, the pensionable and eligible salary or wages paid for the year, minus the gross income paid by mistake if this income was subject to QPP contributions and QPIP premiums);
• in boxes B and H, the total QPP contributions and QPIP premiums withheld at source during the year (including the amounts withheld from the employment income paid by mistake if this income was subject to QPP contributions and QPIP premiums), minus the amounts withheld from the employment income paid by mistake if this income was subject to QPP contributions and QPIP premiums and the employer made the election to be refunded an amount equal to the net income;
• in box E, the total Québec income tax withheld at source during the year (including the income tax withheld on the employment income paid by mistake), minus the income tax withheld on the employment income paid by mistake if the employer made an election to be refunded an amount equal to the net income;
• in the other boxes, the amounts from RL-1 slip that has already been filed;
• the word “Modifié” on copy 2 of the RL-1 slip given to the employee and copy 1 of the RL-1 slip filed with us (if the slip is filed on paper).

Instructions for employees

An employee who repays an employer the net amount of employment income received by mistake in a previous year does not have to recover the excess income tax, QPP contributions and QPIP premiums deducted from Revenu Québec, if the employer made an election to that effect. The employee will have to complete form TP-1.R-V, Request for an Adjustment to an Income Tax Return, to change the income tax return already filed.

One of the measures that the Minister of Finance announced in the 2018–2019 Budget Speech given on March 27, 2018, was the creation of a new Québec sales tax (QST) registration service to ensure tax fairness for suppliers outside Québec and Québec businesses with regard to the collection of the QST.

As a result, foreign suppliers must register for the QST using the new service, and Canadian suppliers will have to follow suit by September 1, 2019. Some digital platforms that act as intermediaries between suppliers and consumers also have to register.

Foreign suppliers: Mandatory registration since January 1, 2019

Registration using the new system is mandatory for suppliers outside Canada that meet the following conditions:

• They do not have any establishments in Canada, nor do they carry on a business in Canada.
• They are not currently registered for the QST or the GST/HST.
• They make more than $30,000 per year in supplies of services or incorporeal movable property in Québec to consumers, other than via certain digital platforms.

Canadian suppliers: Mandatory registration as of September 1, 2019

Registration using the new system will be mandatory for Canadian suppliers outside Québec that meet the following conditions:

• They do not have any establishments in Québec, nor do they carry on a business in Canada.
• They are not currently registered for the QST.
• They are currently registered for the GST/HST.
• They make more than $30,000 per year in supplies of services or incorporeal movable property in Québec to consumers, other than via certain digital platforms.

A major step toward tax fairness!

With online transactions more prevalent than ever, taxation in the digital economy represents a sizeable challenge for Revenu Québec. This measure is an important step toward our goal of ensuring tax fairness in every field.

To learn more, click Suppliers Outside Québec.

A new measure that came into effect on January 1, 2019, has resulted in new Québec sales tax (QST) obligations for foreign businesses and operators of digital platforms for the distribution of property or services. Since they are now required to collect and remit QST on taxable sales of incorporeal movable property and services to individuals in Québec who are not registered for the QST, they must now charge QST on their online sales.

A major step toward tax fairness!

With online transactions more prevalent than ever, taxation in the digital economy represents a sizeable challenge for Revenu Québec. This measure is an important step toward our goal of ensuring tax fairness in every field.

To learn more, click Suppliers Outside Québec.

Mandatory QST registration for suppliers outside Québec

To ensure tax fairness between suppliers outside Québec and those in Québec with respect to the collection of the Québec sales tax (QST), the Minister of Finance announced, in the 2018-2019 Budget Speech delivered on March 27, 2018, that a new QST registration service would be created.

As a result, suppliers outside Canada must register for the QST using the new service before January 1, 2019. Suppliers in Canada (outside Québec), must do so before September 1, 2019. Note that registration will also be mandatory for certain digital platforms acting as intermediaries between suppliers and consumers.

Suppliers outside Canada: mandatory registration before January 1, 2019

Registration is mandatory for suppliers outside Canada that meet the following conditions:

• They do not have any establishments in Canada, nor do they operate a business here.
• They are not already registered for the QST or the GST/HST.
• The total of certain of their taxable supplies made in Québec to consumers (not including those made over certain digital platforms) exceed $30,000 per year.
• They supply services and incorporeal moveable property in Québec to people who are not registered for the QST.

Suppliers in Canada (outside Québec): mandatory registration before September 1, 2019

Registration is mandatory for suppliers in Canada (outside Québec) that meet the following conditions:

• They do not have any establishments in Canada, nor do they operate a business here.
• They are not already registered for the QST.
• The total of certain of their taxable supplies made in Québec to consumers (not including those made over certain digital platforms) exceed $30,000 per year.
• They supply services and incorporeal moveable property in Québec to people who are not registered for the QST.

A key step toward ensuring tax fairness

With online transactions more prevalent than ever, taxation in the digital economy represents a sizeable challenge for Revenu Québec. This measure is an important step toward our goal of ensuring tax fairness in every field.

For more information, click Suppliers Outside Québec.