Quebec Budget 2024: Key Tax Changes

The lowest Quebec provincial income tax rate drops from 15% to 14% effective January 1, 2025. This is the first rate reduction in the lowest bracket in over a decade. A Quebec taxpayer with $50,000 of income saves approximately $500 per year. The change is applied on the Quebec provincial return (TP-1) and is separate from the federal T1 return.

The Quebec Sales Tax remains at 9.975%, applied on top of the federal GST of 5%. The combined QST and GST rate on most taxable goods and services in Quebec is approximately 14.975%. Quebec operates its own QST system, making it the only province outside Atlantic Canada with a non-harmonized consumption tax at this rate. Businesses in Quebec register separately for QST and GST.

QPIP provides parental, maternity, paternity, and adoption benefits to Quebec workers at a higher replacement rate than federal Employment Insurance parental benefits. QPIP premiums for 2024 are 0.494% of insurable earnings for employees and 0.692% for employers (compared to EI premium rates). Quebec workers opt out of the federal EI parental benefits system since QPIP provides equivalent or superior coverage.

Updated RL-1 (Relevé 1) reporting requirements clarify how to report benefits related to remote work arrangements, including home office expense allowances. Employers providing a fixed monthly allowance for home office use must report amounts above the per-kilometre reimbursement rate as a taxable benefit. The RL-1 is the provincial equivalent of the T4 slip and is required in addition to the federal T4 for Quebec employees.