Revenu Québec Infos

Businesses that offer landscaping services may have fiscal obligations with regard to the GST, the QST, income tax, source deductions and employer contributions.

GST and QST

A landscaping business that carries on taxable services in Québec must register for the GST and the QST. It must collect these taxes on its services and remit them to us. Furthermore, a landscaping business may claim an input tax credit (ITC) for the GST paid and an input tax refund (ITR) for the QST paid on the goods and services it acquired to carry out its landscaping services.

If the business is considered to be a small supplier, it is not required to register for the GST and the QST. However, it can choose to register. Registered small suppliers must collect the GST and the QST and remit them to us. If the small supplier is registered, it can claim ITCs and ITRs for the GST and QST paid on its purchases.

Note

A business that indicates the date, the type of service provided, the amounts of tax collected and its GST and QST registration numbers on its bills provides its clients that are also GST and QST registrants with the information they need to support their ITC and ITR claims.

For more information, see GST/HST and QST.

Income tax

If the business is operated by a corporation, the corporation must file an income tax return, along with its complete financial statements, no later than six months after the end of its taxation year. For more information, see Corporation Income Tax Return .

If the business is operated by an individual in business, the individual must file an income tax return no later than June 15 of the year following the taxation year concerned. For more information, see Income Tax Return.

Source deductions and employer contributions

A business that pays salaries and wages, or remuneration must register as an employer for source deductions. It must make source deductions and remit the amounts withheld and the applicable employer contributions. For more information, see Source Deductions and Contributions.

If, as part of the payroll services you provide to an employer, you prepare and file RL slips and summaries of source deductions and employer contributions, you must enter the employer's name and account number on all RL slips and summaries.

An employer's account number is composed of

• 10 numbers (the identification number); and
• the letters “RS” followed by 4 numbers (the file number).

Account numbers look like this: 1234567890RS0001.

Note that we assign an account number when an employer either registers for source deductions or makes its first remittance of source deductions.

For more information, see Registering for Source Deductions and RL-1 Summary – Summary of Source Deductions and Employer Contributions, or consult the Tax Preparers' Guide: RL Slips (ED-425-V).

If you are entitled to the reduced rate of the contribution to the health services fund for small and medium-sized businesses in the primary and manufacturing sectors, and the amounts paid to Revenu Québec toward your contribution to the health services fund after January 1, 2015, were not calculated using the reduced rate, you can determine the actual amount of your contribution for the year when you file the Summary of Source Deductions and Employer Contributions (form RLZ-1.S-V or RLZ-1.ST-V). If applicable, you will receive a refund of the overpayment. On line 38 of the summary, enter the amount of the contribution to the health services fund you remitted in the year using the periodic remittance forms.

For more information, refer to Information Bulletin 2014-11 (PDF – 555 KB), published by the Ministère des Finances on December 2, 2014.

The transitional measures in place to ease into the new rate of the tax on insurance premiums applicable to the payment of automobile insurance premiums have been updated to grant additional time to persons with a monthly reporting period.

For more information, see New Tax Rate – Tax on Insurance Premiums.

Starting in 2015, full-time students will no longer be eligible for the work premium, the adapted work premium or the supplement to the work premium, unless they are, at the end of the year, the parent of a child who lives with them.

A full-time student is a student pursuing vocational training at the secondary level or post-secondary studies who is in either of the following situations:

• In the year, the student begins and completes a term during which he or she must devote a minimum of 9 hours a week to classes or coursework.
• The student has a major functional deficiency within the meaning of the Regulation respecting financial assistance for education purposes, and he or she begins and completes, in the year, a term during which he or she receives a minimum of 20 hours of instruction per month.

For more information, refer to pages 29 to 30 of Information Bulletin 2014-11 (PDF – 555 KB), which was published on December 2, 2014, by the Ministère des Finances.

The limits and rates related to the Québec Pension Plan (QPP) for 2015 are as follows:

• The maximum pensionable earnings have been increased from $52,500 to $53,600.
• The basic exemption is $3,500.
• The maximum contributory earnings have been increased from $49,000 to $50,100.
• The contribution rate has been increased from 5.175% to 5.25% for both employers and employees.
• The maximum employee contribution has been increased from $2,535.75 to $2,630.25.
• The maximum employer contribution has been increased from $2,535.75 per employee to $2,630.25 per employee.
• The contribution rate for self-employed persons has been increased from 10.35% to 10.50%.
• The maximum contribution for a self-employed person has been increased from $5,071.50 to $5,260.50.

If your total payroll for the year is less than $5 million and you meet certain conditions, you may be able to take advantage of a reduction in

• the rate of your contribution to the health services fund for small and medium-sized businesses (SMBs) in the primary and manufacturing sectors;
• the contribution to the health services fund for the creation of specialized jobs in the natural and applied sciences sector.

Reduced rate of the contribution to the health services fund for small and medium-sized businesses in the primary and manufacturing sectors

If your total payroll for the year is less than $5 million and more than 50% of the total payroll is attributable to activities in the mining sector or the primary sector (which includes activities in the agriculture, forestry, and fishing and hunting sector and in the mining, quarrying and oil and gas extraction sector), the rate of your contribution will be determined as follows:

• if your total payroll is $1 million or less, the rate of your contribution is 1.6%;
• if your total payroll is more than $1 million but less than $5 million, the rate of your contribution is calculated using the following formula:

  W (%) = 0.935 + (0.665 × S)

  where

  S = total cumulative payroll divided by $1,000,000
• if your total payroll is $5 million or more, the rate of your contribution is 4.26%.

Note

The activities concerned are those grouped under codes 11, 21 or 31-33 of the North American Industry Classification System (NAICS) Canada. For a description of the codes, visit the Statistics Canada website.

This measure is effective January 1, 2015.

Reduced contribution to the health services fund to foster the creation of specialized jobs in the natural and applied sciences sector

If you hired an employee to hold a recognized full-time job in Québec, and your total payroll for the year is less than $5 million, you may be able to take advantage of a reduction in the contribution to the health services fund until December 31, 2020, for the increase in your payroll attributable to the hiring of specialized employees. To calculate the reduction and obtain a refund, complete form LE-34.1.12-V, Reduction of the Contribution to the Health Services Fund: Creation of Specialized Jobs, and enclose it with the RL-1 summary.

Below are the principal changes made to the guide entitled Formulas to Calculate Source Deductions and Contributions (TP-1015.F-V) for 2015.

Variable E

The indexation factor used to calculate the value of personal tax credits for 2015 is 1.06%.

Variables H, H1 and H2 – Deduction for employment income

The maximum deduction for employment income has been increased from $1,110 to $1,120 for 2015. Consequently, the maximum amount of variables H, H1 and H2 has been increased from $1,110 to $1,120.

Variable K – The constant for adjusting the income tax rate

For 2015, 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 $41,935 or less (previously $41,495);
• the 20% rate applies to taxable income of more than $41,935, but not more than $83,865 (previously $82,985);
• the 24% rate applies to taxable income of more than $83,865, but not more than $102,040 (previously $100,970);
• the 25.75% rate applies to taxable income of more than $102,040.

The values of variable K are therefore $1,677 (increased from $1,659), $5,032 (increased from $4,979) and $6,817 (increased from $6,746).

Variable M – Québec Pension Plan

The QPP contribution rate has been increased from 10.35% to 10.50%, for 2015, which corresponds to a contribution rate of 5.25% for the employee and 5.25% for the employer.

In addition, the maximum pensionable earnings for the purposes of the QPP have been increased from $52,500 to $53,600. Variable M has therefore been increased from $2,535.75 to $2,630.25.

Variables N and N1 – Québec parental insurance plan

The maximum insurable earnings subject to QPIP premiums have been increased from $69,000 to $70,000 for 2015. The employee premium rate remains 0.559%, and the employer premium rate remains 0.782%. As a result, variable N is $391.30 (instead of $385.71) and variable N1 is $547.40 (instead of $539.58).

Variables Q and Q1 – Shares in Fondaction and in the Fonds de solidarité des travailleurs du Québec

The temporary increase in the tax credit for the purchase of shares issued by Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l'emploi, which came into effect on June 1, 2009, comes to an end on May 31, 2015. As such, the rate of the tax credit for the purchase of shares issued by Fondaction decreases from 25% to 15% for any share or fraction of a share purchased after May 31, 2015. This changes the way the source deduction of income tax of an employee who pays into the fund through source deductions is calculated.

Q = amount withheld for a pay period for the purchase of class A shares in the Fonds de solidarité des travailleurs du Québec (FTQ) or amount withheld for the pay period that begins after May 31, 2015, for the purchase of class A or class B shares in Fondaction, le fonds de développement de la Confédération des syndicats nationaux pour la coopération et l'emploi

Q1 = amount withheld for the pay period that ends before June 1, 2015, for the purchase of class A or class B shares in Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l'emploi

Note

The total value of variables Q and Q1 must not exceed $5,000 for the year. For the pay period in which the annual maximum is reached, the value of variables Q and Q1 must be zero.

Variable W – Rate of the contribution to the health services fund

The definition of variable W has been changed to include the reduced rate of the contribution to the health services fund for SMBs in the primary or manufacturing sector. The reduction applies where the total payroll of the SMB is less than $5 million and 50% of the total payroll is attributable to activities in the primary and manufacturing sectors. Variable W is calculated as follows:

W (%) = 0.935 + (0.665 × S)

See document TP-1015.F-V for more information.

Variable Z – Health contribution

For 2015, the rates and the amounts used to calculate the value of the health contribution (variable Z) remain unchanged. However, the net income thresholds have been indexed.

Estimated annual net income (R)
Health contribution (Z)

$18,370 or less

$0

More than $18,370, no more than $40,820

Whichever is less:

• $100
• 5% x (R − $18,370)

More than $40,820, no more than $132,650

Whichever is less:

• $200
• $100 + [5% × (R − $40,820)]

More than $132,650

Whichever is less:

• $1,000
• $200 + [4% × (R − $132,650)]

The rates, thresholds and amounts applicable to source deductions and contributions for 2015 are described below.

Indexation for 2015

Every year, the personal income tax system is automatically indexed. The indexation factor for 2015 is 1.06%.

Income tax rates and income thresholds

For 2015, 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 $41,935 or less (previously $41,495);
• the 20% rate applies to taxable income of more than $41,935, but not more than $83,865 (previously $82,985);
• the 24% rate applies to taxable income of more than $83,865, but not more than $102,040 (previously $100,970);
• the 25.75% rate applies to taxable income of more than $102,040.

Source Deductions Return (form TP-1015.3-V)

The Source Deductions Return (form TP-1015.3-V) has been revised for 2015 to take into account the indexation of the amounts appearing on it.

The indexed amounts used to determine deduction codes for 2015 are shown in the table below. The figures for 2014 are provided for information purposes.

Amounts to calculate source deductions
2015 2014 Basic amount $11,425 $11,305 Amount transferred from one spouse to the other $11,425 $11,305 Amount for other dependants who are 18 or older $3,065 $3,035 Amount for a child under 18 enrolled in post-secondary studies $2,105 $2,085 Additional amount for a person living alone (single-parent family) $1,655 $1,640 Amount for a severe and prolonged impairment in mental or physical functions $2,595 $2,570 Amount for a person living alone $1,340 $1,325 Age amount $2,460 $2,435 Amount for retirement income $2,185 $2,160 Reduction threshold used to calculate the net family income (This income is used to calculate the age amount, the amount for a person living alone and the amount for retirement income.) $33,145 $32,795 Indexation rate for 2015 1.06% 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 $14,130 to $14,300 for 2015.

Deduction for employment income

The maximum deduction for employment income has been increased from $1,110 to $1,120 for 2015.

Emergency services volunteer

The tax-exempt financial compensation paid to an emergency services volunteer has been increased from $1,110 to $1,120 for 2015.

Maximum pensionable earnings and QPP contribution rate

For 2015, the maximum pensionable earnings for the purpose of the QPP have been increased from $52,500 to $53,600 and the QPP contribution rate has been increased from 10.35% to 10.50%, which corresponds to a contribution rate of 5.25% for the employee and 5.25% for the employer. The maximum annual contribution to be withheld for any employee has therefore been increased from $2,535.75 to $2,630.25.

Maximum insurable earnings and QPIP premium rate

For 2015, the maximum insurable earnings for the purpose of the QPIP have been increased from $69,000 to $70,000. The employee premium rate remains 0.559% and the employer premium rate remains 0.782%. As a result, the maximum annual employee premium is $391.30 (instead of $385.71) and that of the employer is $547.40 (instead of $539.58).

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

The portion of the remuneration in excess of $70,000 (instead of $69,000) is not subject to the contribution to the financing of the CNT for 2015.

The temporary increase in the tax credit for the purchase of shares issued by Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l'emploi, which came into effect on June 1, 2009, comes to an end on May 31, 2015. As such, the rate of the tax credit for the purchase of shares issued by Fondaction decreases from 25% to 15% for any share or fraction of a share purchased after May 31, 2015. This changes the way income tax is withheld from an employee who pays into the fund through source deductions.

If you use the Source Deduction Table for Québec Income Tax (TP-1015.TI-V) to determine the amount of income tax to withhold, you must subtract from the employee's gross remuneration, for a pay period that begins after May 31, 2015, 75% (rather than 125%) of the amount deducted from the employee's remuneration for the purchase of shares issued by Fondaction. For more information, refer to section 5.4.1 of the Guide for Employers (TP-1015.G-V).

If you use the formulas in the guide entitled Formulas to Calculate Source Deductions and Contributions (TP-1015.F-V) to determine the amount of income tax to withhold, you must take into account the changes to the formulas. For more information, refer to guide TP-1015.F-V.

On January 1, 2015, the tax rate for insurance premiums applicable to automobile insurance premiums will be changed from 5% to 9%, which is the rate applicable to most other types of insurance premiums.

For more information, click New Tax Rate – Tax on Insurance Premiums.

As of 2015, the thresholds for the average monthly remittance based on which you are required to make your remittances of source deductions and employer contributions will increase. The remittance threshold increases

• from $15,000 to $25,000 if the employer's remittance frequency is twice-monthly;
• from $50,000 to $100,000 if the employer's remittance frequency is weekly.

If, after June 4, 2014, you hired an employee to hold a recognized full-time job in Québec, and your total payroll for the year is less than $5 million, you may be able to take advantage of a reduction in the contribution to the health services fund until December 31, 2020, for the increase in your payroll attributable to the hiring of specialized employees. To calculate the reduction and obtain a refund, complete form LE-34.1.12-V, Reduction of the Contribution to the Health Services Fund: Creation of Specialized Jobs, and enclose it with the RL-1 summary.

Allowance for the use of a motor vehicle

For 2014, the per-kilometre rate for the use of a motor vehicle that you pay an employee that we consider reasonable is $0.54 for the first 5,000 kilometres and $0.48 for each additional kilometre.

Operating-costs benefit related to an automobile made available to an employee

For 2014, the per-kilometre rate used to calculate the operating-costs benefit related to an automobile made available to an employee is $0.27. For employees engaged principally in selling or leasing automobiles, the per-kilometre rate is $0.24.

Additional information pertaining to the security option deduction

The additional information for code L-6 (Security option deduction) has been replaced by the following:

• L-9 (Security option deduction under section 725.2 of the Taxation Act);
• L-10 (Security option deduction under section 725.3 of the Taxation Act).

For more information, refer to the document Taxable Benefits (IN-253-V).

As employers, all health and social services centres must determine the status of the workers they hire, as their tax obligations will vary accordingly.

Status of workers

A person working at a health and social services centre can be considered to be either an employee or a self-employed person. The status of a worker is determined mainly on the basis of subordination to an employer, but also on the basis of five other criteria.

For example, a worker is considered to be an employee if, in fact, he or she undertakes to do work for a limited time and for remuneration under the direction or control of an employer.

Conversely, a worker is considered to be self-employed if he or she is free to choose the means of carrying out a contract and there is no relationship of subordination with the employer. For more information on the tax obligations of self-employed workers, refer to the brochure Are you Self-Employed? Taxation Reference Tool (IN-300-V).

Benefits provided to employees

As an employer, a health and social services centre is responsible for withholding Québec income tax at source from all remuneration (salaries, wages and other amounts) it pays to its employees. Furthermore, if it provides taxable benefits to an employee, it must include the value of the benefits in the employee's income. Benefits that an employee receives because of his or her office or employment are generally taxable.

Examples

Parking space

As a rule, an employee receives a taxable benefit in the following circumstances:

• the employer provides him or her with a parking space free of charge or at a price below the fair market value (This link will open a new window) (FMV)
• the employer reimburses him or her for the cost of a parking space

The value of the benefit corresponds to the FMV of the parking space (including GST and QST) minus any amount paid by the employee for its use.

Meals

If an employee is provided with a free or subsidized meal (such as meals in an employee dining room or cafeteria), the meal is generally considered to be a taxable benefit. The value of the benefit corresponds to the result of the following calculation: the cost of the food (including GST and QST) and, where applicable, the cost of preparing and serving the food, minus any amount paid by the employee.

However, there is no taxable benefit if meals are provided or meal expenses are reimbursed to employees who work overtime at the employer's request, where the overtime is expected to last for at least two consecutive hours and is done occasionally.

A health and social services centre is generally free to choose the means, tools and methods it will use to calculate the value of the taxable benefits granted to its employees, as long as they are reasonable and reliable. For example, it can:

• ask its employees to provide supporting documents
• provide its employees with punch cards
• keep records to calculate the value of the benefits provided

For more information on taxable benefits, refer to the guide Taxable Benefits (IN-253-V).

The definition of the term “base wages” has been amended. Base wages, which are used as the starting point in the calculation of employer contributions, now include any amount paid, allocated, granted or awarded to an employee by a person with whom the employer is not dealing at arm's length that would have been included in the base wages had these been paid, allocated, granted or awarded by the employer.

For example, an employer is required to include in an employee's salary or wages, the value of a benefit related to a security option that the employee receives from a foreign corporation with whom the employer is not dealing at arm's length.

Tax legislation will be amended to provide that, for the income splitting mechanism to be applicable in a particular taxation year, the person whose income is split must have reached 65 years of age before the end of the year, or, if the person died or ceased to be resident in Canada in the year, on the date of his or her death or the date on which he or she ceased to be resident in Canada.

This amendment will apply as of the 2014 taxation year.

For more information, see pages 65 to 67 of the document entitled Additional Information on the Fiscal Measures of the Budget (PDF – 795 KB) tabled on June 4, 2014, by the Ministère des Finances.

Canadian-controlled private corporations whose paid-up capital is less than $15 million can claim an additional deduction in calculating their net income to reflect the higher transportation costs attributable to the distance of certain regions from Québec's large urban centres.

The amount of the additional deduction a corporation can claim for a taxation year may vary depending on a number of parameters, that is, the region where it carries out its manufacturing activities, the level of its manufacturing activities, the size of the corporation, its gross income for that taxation year and a regional cap.

The amount of this additional deduction, for a taxation year, may reach 6% of gross income for that taxation year.

Determination of the additional deduction rate

The base rate a corporation can claim for a taxation year will depend on the region where its manufacturing activities are carried out. Rates of 2%, 4% and 6% apply to the “intermediate zone”, the “remote zone” and the “special remote zone” respectively. The rate applicable to other regions, in Québec or elsewhere, is zero.

The additional deduction rate applicable to a corporation for a taxation year is the one applicable to the zone in which the “manufacturing and processing capital cost” (MPCC) is the highest for that taxation year.

A manufacturing SME whose proportion of activities attributable to manufacturing and processing activities, for a given taxation year, is 50% or more, can claim the maximum additional deduction rate applicable to it for that taxation year, that is, the rate depending on the zone where the largest share of its manufacturing activities are carried out.

Moreover, where such proportion, for a given taxation year, is between 50% and 25%, the additional deduction rate the manufacturing SME can claim, for that taxation year, is reduced linearly.

The additional deduction rate applies to a taxation year ending after June 4, 2014. However, where the taxation year of a manufacturing SME includes June 4, 2014, the additional deduction rate applies in proportion to the number of days of the taxation year that follow June 4, 2014.

Determination of the additional deduction cap

The additional deduction is limited to a percentage of the manufacturing SME's gross income for the taxation year. This percentage is the additional deduction rate applicable to the manufacturing SME for that taxation year.

The additional deduction thus obtained is, however, limited to a regional cap for manufacturing SMEs benefiting from a rate of 4% and 2%, that is, those that carry out the largest share of their manufacturing activities in the remote zone or the intermediate zone. These caps will be $250,000 and $100,000 respectively. No regional cap is applied for manufacturing SMEs that carry out the largest share of their manufacturing activities in the special remote zone.

Moreover, the additional deduction calculated according to the rules set out above is reduced depending on the corporation's size. Canadian-controlled private corporations with paid-up capital of $10 million or less enjoy a reduced income tax rate of 8% on the first $500,000 of annual income — the small-business income ceiling — from an eligible business.

The additional deduction a manufacturing SME can claim for a taxation year is reduced on the basis of the size parameters applicable to the reduced income tax rate.

For more information, see pages 3 to 7 of the Additional Information on the Fiscal Measures of the Budget (PDF – 795 KB) tabled by the Ministère des Finances on June 4, 2014.

Two new fiscal measures are being added to the refundable tax credits for the construction or conversion of a ship.

Creation of a tax-free reserve

The first measure enables a Québec shipowner to set up a tax-free reserve to award the execution of construction, renovation and maintenance work on vessels of the shipowner's fleet to a Québec shipyard.

This measure applies in relation to a tax-free reserve set up after June 4, 2014, pursuant to a certificate issued by the Ministère de l'Économie, de l'Innovation et des Exportations after June 4, 2014.

Additional capital cost allowance of a vessel

Under the second measure, a Québec shipowner that awards work to a Québec shipyard can claim an additional deduction for the depreciation of a vessel.

This measure applies, for a taxation year, to the cost of work done by a qualified shipyard in relation to a Canadian vessel, pursuant to a contract a taxpayer enters with such a shipyard after June 4, 2014, but before January 1, 2024.

For more information, see pages 14 to 20 of the document entitled Additional Information on the Fiscal Measures of the Budget (PDF – 795 KB) tabled on June 4, 2014, by the Ministère des Finances.

A 20% reduction in tax assistance intended for businesses was announced in the Budget Speech delivered on June 4, 2014. The following measures are affected by this reduction:

• Tax credit for technological adaptation services
• Tax credits for a design activity
• Tax credits for production of multimedia titles
• Tax credit for major employment-generating projects
• Tax credit for job creation in the resource regions, Vallée de l'aluminium, Gaspésie and certain maritime regions of Québec
• Tax credit for job creation in Gaspésie and certain maritime regions of Québec: marine biotechnology, mariculture and processing of marine products
• Tax credit relating to resources
• Tax benefits relating to flow-through shares
• Tax credit for salaries and wages (IFC)
• Tax credit for new financial services corporations
• Tax credit for the hiring of employees by new financial services corporations
• Tax credit for the diversification of markets of a Québec manufacturing company
• Tax credit for the modernization of a tourist accommodation establishment
• Tax credit for Québec film productions
• Tax credit for film production services
• Tax credit for film dubbing
• Tax credit for the production of sound recordings
• Tax credit for the production of performances
• Tax credit for book publishing
• Tax credit for the production of events or multimedia environments staged outside Québec
• Tax credit for an on-the-job training period
• Tax credit for training in the manufacturing forestry and mining sectors

Measures tightening tax assistance were also introduced for the following:

• Tax credits for scientific research and experimental development
• Tax credit for the development of e-business
• Tax credit for investment
• Tax credit relating to a building used by a small or medium-sized manufacturing business in manufacturing or processing activities
• Tax credit relating to information technologies in small and medium-sized manufacturing businesses
• Tax credit relating to resources

For more information, see pages 31 through 61 and 78 of the Additional Information on the Fiscal Measures of the Budget (PDF – 795 KB) published on June 4, 2014, by the Ministère des Finances.