Revenu Québec Infos

Pooled registered pension plan

A pooled registered pension plan (PRPP) administrator must file RL-2 slips (see courtesy translation RL-2-T) to report any amount paid (including amounts from which a source deduction was made) during the year to persons who were resident in Québec on December 31 of the year concerned, or who were resident in Québec immediately before ceasing to reside in Canada during the year concerned.

However, a PRPP administrator must not use an RL-2 slip to report

• the total of the transferable payments of a PRPP made directly to
  • another PRPP, a registered pension plan (RPP), a registered retirement savings plan (RRSP), a registered retirement income fund (RRIF) or a deferred profit-sharing plan (DPSP) in the name of the annuitant or in the name of the annuitant's spouse,
  • a licensed annuities provider for the acquisition of a qualifying annuity;
• the value of property transferred directly from a RRIF, an RRSP, an RPP or a DPSP to a PRPP in the name of the same annuitant.

For more information, contact us.

Additional information

The following changes were made to the additional information related to the RRIF:

• Code B-1 was changed from "Amount exceeding the minimum amount" to "Payment from a RRIF exceeding the minimum amount"
• Code B-2 was changed from "Excess amount transferred in whole or in part" to "Payment from a RRIF that was transferred"
• Code B-3 was changed from "Designated benefit" to "Designated benefit exceeding the minimum amount"

In calculating the taxable benefits related to the use of an automobile or the automobile expenses that can be deducted for income tax purposes, you must take into account certain limits and prescribed rates. The limits and rates for 2014, which are the same as those for 2013, are listed below:

• For purposes of capital cost allowance (CCA), the ceiling on the capital cost of passenger vehicles is $30,000 (plus GST and QST) for vehicles purchased after 2013.
• The limit on deductible leasing costs is $800 per month (plus GST and QST) for leases entered into after 2013. Under a separate restriction, deductible leasing costs are prorated where the value of the passenger vehicle exceeds the capital cost ceiling.
• The limit on the deduction of tax-exempt allowances paid by employers to employees using their personal vehicle for business purposes remains 54 cents per kilometre for the first 5,000 kilometres and 48 cents for each additional kilometre.
• The maximum allowable interest deduction for amounts borrowed to purchase a passenger vehicle is $300 per month for loans related to vehicles acquired after 2013.
• 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 remains 27 cents per kilometre. For taxpayers employed principally in selling or leasing automobiles, the prescribed rate remains 24 cents per kilometre.

Note

The following is an interim administrative position that is under review. It provides a description of rules that are currently in place.

Residential elevator

The supply of an elevator installed in the residence of an individual who uses a wheelchair is zero-rated (that is, taxable at the rate of 0%) if the elevator is a wheelchair lift or similar aid to locomotion that is specially designed to be operated by an individual with a disability for his or her locomotion. 

For the supply of a residential elevator to be zero-rated, the elevator must be designed to accommodate an individual using a wheelchair and have a sufficient number of the following features so as to distinguish itself from an ordinary elevator:

• The width of the platform is set to accommodate the turning radius of a wheelchair (unless it is a flow through elevator).
• The clearance between the landing edge and the platform is appropriately set to prevent the wheelchair from getting caught.
• Accessibility to the operating control panel and call stations is adjusted for an individual in a wheelchair.
• The elevator contains:
  • appropriate handgrips or handrails for use by an individual in a wheelchair
  • anti-skid or similar flooring
  • key-controlled continuous pressure buttons
• Flush mount door and floor frames are installed allowing for easy entry and exit from the cab.
• Accordion doors are removed and light curtains or similar closure are installed.
• Two to five levels are served.
• The maximum capacity is 454 kg (1,000 lbs).

Installation service and parts

If the supply of a residential elevator is zero-rated, its installation is also zero-rated. However, services that are related to, or that accommodate the installation of, the residential elevator are taxed at 5% under the GST and 9,975% under the QST. For example, a service of installing a residential elevator does not include architectural services, delivery services, demolishing services and construction and renovation services of the home, including services relating to renovating an area in or adjacent to the home (for example, a hallway or a garage) to accommodate the elevator.

However, the parts required for the installation of the elevator (for example, a hoistway) are zero-rated when supplied in conjunction with the installation service.

Refund of taxes paid in error

Under this interim administrative position, a supplier can refund or credit clients for amounts of GST and QST collected and remitted in error on zero-rated supplies. Alternatively, individuals can apply to Revenu Québec for a rebate of the taxes paid in error, provided that the application is made within two years of the date on which the taxes were paid.  

Suppliers are required to retain documentation proving that the elevator has some of the features listed above and is therefore zero-rated. Individuals applying for a rebate of taxes paid in error on a residential elevator must provide documentation proving that the elevator has some of the features listed above. No rebate will be issued for taxes paid on residential elevators that do not have these features.

To apply for a rebate of consumption taxes paid in error, complete forms FP-189-V General GST/HST Rebate Application, and VD-403-V, General Application for a Québec Sales Tax (QST) Rebate, and send them to Revenu Québec. For more information, consult the Guide to the General GST/HST Rebate Application (FP-189.G-V).

Beginning January 1, 2014, municipalities (and organizations designated as a municipality) are entitled to a rebate of 62.8% of the QST paid on property and services acquired to make exempt supplies. The rebate mechanism is similar to that provided for under the GST system.

The 62.8% QST rebate applies to supplies of property and services for which the QST became payable after December 31, 2013, and was paid after that date.

For information on which municipal entities are eligible for the rebate or on the changes to the QST system, see information bulletin 2013-12, published on December 2, 2013, by the Ministère des Finances et de l'Économie.

For examples of situations in which the rebate may or may not apply, click QST Rebate for Municipalities and Organizations Designated as a Municipality.

Are you required to file the Trust Income Tax Return (form TP-646-V)?

A trust, other than an excluded trust, that satisfies one of the new conditions below is now also required to file an income tax return for any taxation year that begins after November 20, 2012.

• In calculating its income for the taxation year, the trust is deducting an amount allocated to a beneficiary, regardless of the beneficiary's place of residence.
• If the trust is resident in Québec on the last day of the taxation year, it owns, at some time in that year, property the total of whose cost amounts is more than $250,000.
• If the trust is not resident in Québec on the last day of the taxation year, it owns, at some time in that year, property that it uses in carrying on a business in Québec and the total of whose cost amounts is more than $250,000.

For more information, see the Guide to Filing the Trust Income Tax Return (TP-646.G-V) for 2013.

Are you required to file the Trust Information Return (form TP-646.1-V)?

For any taxation year that begins after November 20, 2012, a trust, other than an excluded trust, that is resident in Canada, outside Québec, and that, at some time in the taxation year concerned, owns a specified immovable (or is a member of a partnership that owns such an immovable) is required to file an information return for that year. The trust must complete the new Trust Information Return (form TP-646.1-V).

The information in sections 2.13 and 5.4.1.6 of the 2014 Guide for Employers published in November 2013 has been updated to reflect the provisions of the Voluntary Retirement Savings Plans Act, which was assented to on December 4, 2013.

Contribution to a VRSP or a PRPP

You must deduct the voluntary retirement savings plan (VRSP) or pooled registered pension plan (PRPP) contribution from the employee's gross remuneration for a pay period and remit the amount to the VRSP or PRPP administrator. If you contribute to a VRSP or a PRPP on behalf of an employee, the contribution does not constitute a taxable benefit for the employee.

The rules related to a VRSP will apply as of July 1, 2014.

PRPPs are offered by employers whose business activities are under federal jurisdiction.

As a rule, the GST and QST apply to medical and assistive devices intended for consumers, health-care institutions and health-care professionals. However, certain devices may be zero-rated if they meet certain conditions.

The supply (This link will open a new window) of a mucus suction apparatus is zero-rated where the apparatus can form part of a tracheostomy supply that a person can use in his or her home, regardless of the use for which it was purchased.

The limits and rates related to the Québec Pension Plan (QPP) for 2014 are as follows:

• The maximum pensionable earnings have been increased from $51,100 to $52,500.
• The basic exemption is $3,500.
• The maximum contributory earnings have been increased from $47,600 to $49,000.
• The contribution rate has been increased from 5.10% to 5.175% for both employers and employees.
• The maximum employee contribution has been increased from $2,427.60 to $2,535.75.
• The maximum employer contribution has been increased from $2,427.60 per employee to $2,535.75 per employee.
• The contribution rate for self-employed persons has been increased from 10.20% to 10.35%.
• The maximum contribution for a self-employed person has been increased from $4,855.20 to $5,071.50.

We wish to remind you that if you sell merchandise to an employee at a reduced price, we do not, as a rule, consider this a taxable benefit, as long as the discount is reasonable under the circumstances.

However, the employee receives a taxable benefit in the following situations:

• If merchandise that is neither outdated nor unfit for sale is purchased from you by the employee at below-cost prices.
• If you have made a special agreement with the employee or a selected group of employees, allowing for the purchase of merchandise at a discount.

Where the benefit is taxable, its value is equal to the difference between the FMV of the merchandise (including GST and QST) and the price paid by the employee.

As of January 1, 2014, where an employee is transferred from an establishment subject to the CPP to an establishment subject to the QPP, you must multiply the total CPP contributions withheld since the beginning of the year by a weighting factor to determine the maximum employee QPP contribution to withhold. To obtain the factor, divide the QPP contribution rate for the year by the CPP contribution rate for the year. See the example in section 6.13 of the Guide for Employers (TP-1015.G-V).

For the purposes of the Fuel Tax Act, butane is considered to be gasoline.

The sale of butane is exempt from the fuel tax when sold to a consumer in a container

• used exclusively for supplying the heating system of an immovable; or
• used for any purpose other than supplying an internal combustion engine.

This exemption is applicable only at the time of the retail sale of butane, as it is impossible for the vendor to determine whether the above conditions are met under any other circumstances.

Consequently, the fuel tax does apply to the sale of butane for resale purposes. The holder of a collection officer's permit must report all such butane transactions and collect an amount equal to the tax on these transactions, as with the sale of any other fuel.  Information relating to butane should be entered in the fields reserved for gasoline on fuel tax returns.  

However, Revenu Québec considers the sale of butane for resale purposes to be exempt from the fuel tax if

• the butane is sold in the same container in which it will be sold to consumers; and
• the container is used exclusively for supplying the heating system of an immovable or for any purpose other than supplying an internal combustion engine.

For example, the sale for resale purposes of butane canisters used for camping purposes is exempt from the fuel tax.

The changes to the Formulas to Calculate Source Deductions and Contributions (TP-1015.F-V) for 2014 are given below.

Variable E

The indexation factor used to calculate the value of personal tax credits for 2014 is 0.97%.

Variables F and F2

The voluntary retirement savings plan (VRSP) contribution and the pooled registered pension plan (PRPP) contribution have been added to variables F and F2. For more information, see section 2.13 of the Guide for Employers (TP-1015.G-V) for 2014.

Variables H, H1 and H2 – Deduction for employment income

For 2014, the maximum deduction for employment income has been increased from $1,100 to $1,110. Consequently, the maximum amount of variables H, H1 and H2 has been increased from $1,100 to $1,110.

Variable K – The constant for adjusting the income tax rate

For 2014, the income tax rates applicable to taxable income brackets remain unchanged and the income thresholds for these brackets have been indexed. Specifically,

• the 16% rate applies to taxable income of $41,495 or less (previously $41,095); 
• the 20% tax rate applies to taxable income of more than $41,495, but not more than $82,985 (previously $82,190); 
• the 24% tax rate applies to taxable income of more than $82,985, but not more than $100,970 (previously $100,000); 
• the 25.75% applies to taxable income of more than $100,970.

Consequently, the values of variable K are now $1,659 (increased from $1,644), $4,979 (increased from $4,931) and $6,746 (increased from $6,681).

Variable M – QPP

The QPP contribution rate has been increased from 10.20% to 10.35% for 2014, which corresponds to a rate of 5.175% for an employee and of 5.175% for an employer. In addition, the maximum pensionable earnings for the purposes of the QPP have been increased from $51,100 to $52,500. Variable M has therefore been increased from $2,427.60 to $2,535.75.

Variables N and N1 – QPIP

For 2014, the maximum insurable earnings subject to QPIP premiums have been increased from $67,500 to $69,000. The employee premium rate remains 0.559% and the employer premium rate remains 0.782%. Consequently, variable N has been increased from $377.33 to $385.71 and variable N1 has been increased from $527.85 to $539.58.

Variable Z – Health contribution

For 2014, the net income thresholds, the rates and the amounts used to calculate the value of the health contribution (variable Z) remain unchanged.

Estimated annual net income (R) Health contribution (Z) $18,175 or less $0 More than $18,175 but no more than $40,390

Whichever is less:

• $100;
• 5% × (R - $18,175).

More than $40,390 but not more than $131,260

Whichever is less:

• $200;
• $100 + [5% × (R - $40,390)].

More than $131,260

Whichever is less:

• $1,000;
• $200 + [4% × (R - $131,260)].

As indicated in the article Sale of Property by a Financial Services Provider published on July 25, 2013, a financial services provider whose QST registration was cancelled on January 1, 2013, because that provider was not a GST/HST registrant, does not have to collect the QST on the sale of property (such as a list of customers) that meets the conditions listed in that article.

The purchaser of the property, for which the supplier did not have to collect QST, does not have to self-assess the QST.

We wish to reiterate that a financial services provider that remained a QST registrant on January 1, 2013, must collect the QST on the sale of movable property, other than capital property, that the provider owned before that date, even though the provider does not have to collect the GST.

Rates, thresholds and amounts related to source deductions and contributions for 2014 are listed below.

Indexation for 2014

Every year, the personal income tax system is automatically indexed. The indexation factor for 2014 is 0.97%.

Income tax rates and income thresholds

For 2014, the income tax rates applicable to the taxable income brackets remain unchanged and the income thresholds for these brackets have been indexed. Specifically,

• the 16% rate applies to taxable income of $41,495 or less (previously $41,095);
• the 20% rate applies to taxable income of more than $41,495, but not more than $82,985 (previously $82,190);
• the 24% rate applies to taxable income of more than $82,985, but not more than $100,970 (previously $100,000);
• the 25.75% rate applies to taxable income of more than $100,970.

Source Deductions Return (form TP-1015.3-V)

The Source Deductions Return (form TP-1015.3-V) has been revised for 2014 to take into account the indexation of the amounts appearing on it.

The indexed amounts used to determine deduction codes for 2014 are shown in the table below. The figures for 2013 are provided for information purposes.

Amounts for the calculation of source deductions of income tax 2014 2013 Basic amount $11,305 $11,195 Amount transferred from one spouse to the other $11,305 $11,195 Amount for other dependants who are 18 or older $3,035 $3,005 Amount for a child under 18 enrolled in post-secondary studies $2,085 $2,065 Additional amount for a person living alone (single-parent family) $1,640 $1,625 Amount for a severe and prolonged impairment in mental or physical functions $2,570 $2,545 Amount for a person living alone $1,325 $1,310 Age amount $2,435 $2,410 Amount for retirement income $2,160 $2,140 Reduction threshold used to calculate the net family income (This income is used to calculate the age amount, amount for a person living alone and amount for retirement income.) $32,795 $32,480 Gratuities and retroactive pay

The threshold to determine the method to be used to calculate the source deduction of income tax from gratuities and retroactive pay has been increased from $14,000 to $14,130 for 2014.

Maximum deduction for employment income

The maximum deduction for employment income has been increased from $1,100 to $1,110 for 2014

Amount paid to an emergency services volunteer

The tax-exempt financial compensation paid to an emergency services volunteer has been increased from $1,100 to $1,110 for 2014.

Maximum pensionable earnings and QPP contribution rate

For 2014, the maximum pensionable earnings for the purpose of the QPP have been increased from $51,100 to $52,500 and the QPP contribution rate has been increased from 10.20% to 10.35%, which corresponds to a contribution rate of 5.175% for the employee and 5.175% for the employer. The maximum annual contribution to be withheld for any employee has therefore been increased from $2,427.60 to $2,535.75.

Maximum insurable earnings and QPIP premium rate

For 2014, the maximum insurable earnings for the purpose of the QPIP have been increased from $67,500 to $69,000. The employee premium rate remains 0.559% and the employer premium rate remains 0.782%. As a result, the maximum annual employee premium is $385.71 (instead of $377.33) and that of the employer is $539.58 (instead of $527.85).

Maximum remuneration subject to the contribution to the financing of the CNT

The portion of the remuneration in excess of $69,000 (instead of $67,500) is not subject to the contribution to the financing of the CNT for 2014.

Further to the increase in the specific tax on alcoholic beverages announced in the 2013-2014 Budget Speech, persons selling alcoholic beverages have until November 21, 2013, to remit the amount calculated after taking inventory of their alcoholic beverages in stock at 3:00 a.m. on November 21, 2012. 

The benefits paid to the parents of a crime victim by Employment and Social Development Canada, under the Federal Income Support for Parents of Murdered or Missing Children program as a result of a Criminal Code offence, must be entered in box O of the RL-1 slip. The code corresponding to these benefits is CD.

If you pay operating costs for an automobile made available to an employee, you must include an operating-costs benefit in the employee's income. On January 1, 2013, the per-kilometre rate used to calculate that benefit was increased from $0.26 to $0.27. For employees engaged principally in selling or leasing automobiles, the per-kilometre rate was increased from $0.23 to $0.24.

On January 1, 2013, the per-kilometre rate that you pay an employee as an allowance for the use of a motor vehicle and that we consider reasonable was increased from $0.53 to $0.54 for the first 5,000 kilometres and from $0.47 to $0.48 for each additional kilometre.

You may obtain a refund of the fuel tax paid on gasoline acquired after July 11, 2013, and used to supply the engine of a commercial vessel.

In order for you to be entitled to the refund, the gasoline must have been poured directly from the retail dealer's delivery nozzle into the tank installed as standard equipment for supplying the engine of the commercial vessel. Thus, the gasoline must not have come from your own storage tank.

Note

The term "commercial vessel" includes every vessel used principally for purposes other than for pleasure.

To claim the refund, you must complete form CA-10.C-V, Application for a Fuel Tax Refund in Respect of Gasoline Used To Supply the Engine of a Commercial Vessel.

A corporation or partnership that, after November 20, 2012, carries out a large investment project ($200 million or more) in Québec may, under certain conditions, be entitled to a 10-year tax holiday. This tax holiday consists of a deduction in the calculation of the corporation's taxable income and an exemption from the employer contribution to the health services fund with regard to the eligible activities relating to such a project. 

Conditions to be met 

A corporation or a partnership may be exempted from the contribution to the health services fund on the salary and wages paid to an employee for the time that employee spends on eligible activities of the corporation or partnership, where

• the corporation or the partnership holds
  • an initial certificate from the Ministère des Finances et de l'Économie, and
  • an annual certificate for the taxation year from that Ministère;
• the salary or wages are for a pay period included in the exemption period covered by the annual certificate issued for the year concerned, and do not include
  • the wages paid to an employee whose duties consist in building, expanding or modernizing the site where the large investment project will  be carried out,
  • directors' fees,
  • bonuses,
  • taxable benefits,
  • incentives and commissions (except if the employee's duties relate to the commercialization of the activities or products of the business related to the large investment project).

If the pay period does not fall entirely within the exemption period, only the portion of the salary or wages related to the exemption period is exempt from the employer contribution to the health services fund.

The corporation or partnership must enclose with form RLZ-1.S-V, Summary of Source Deductions and Employer Contributions, a copy of the annual certificates and, where applicable, a copy of the partnership agreement for the calendar year for which the corporation or partnership is applying for the exemption from the employer contribution to the health services fund.

The total amount of tax assistance (related to income tax and employer contributions to the health services fund) granted for a large investment project cannot exceed 15% of the total eligible investment expenditures related to such a project. The tax assistance that a corporation or partnership may receive for its taxation year or fiscal period, for a large investment project, cannot exceed an amount corresponding to its tax assistance cap for its taxation year or fiscal period for such a project.

To apply for an initial certificate or an annual certificate, go to the website of the Ministère des Finances et de l'Économie.

For more information, refer to the Guide de la déclaration de revenus des sociétés (CO-17.G).