As tax season approaches in Canada, staying up to date on the annual changes that could impact your income tax filing can be challenging.’
Revenu Québec has compiled a comprehensive list detailing all the changes relevant to the 2023 tax year. This includes adjustments to various tax credits and updates to the criteria determining tax deduction eligibility.
The provincial government has put forth several initiatives to help Quebecers manage rising inflation. In addition to the $500 one-time payments sent out to Quebec residents last tax season, Revenu Québec is implementing a few new initiatives this tax season.
A few changes this year include decreases for the first two income tax brackets, a decrease in certain tax credits, COVID-19 pandemic expenses relating to remote work, and the First Home Savings Account.
Here are all the changes that could affect your 2023 income tax in Quebec:
Tax decrease for the first two income tax brackets
According to Revenu Quebec, the tax rates for 2023 have dropped from:
- 15% to 14% for taxable income up to $49,275
- 20% to 19% for taxable income more than $49,275, but not more than $98,540
More about Quebec income tax rates
Decrease in certain tax credits
For the tax year 2023, certain personal tax credits and rates saw a reduction from 15% to 14% in their conversion rates, per Revenue Quebec.
This decrease impacts several tax credits:
- Basic personal amount
- Age amount, amount for a person living alone, and amount for retirement income
- Amount for dependents and amount transferred by a child 18 or over enrolled in post-secondary studies
- Amount for a severe and prolonged impairment in mental or physical functions
- Tax credit for volunteer firefighters and search and rescue volunteers
- Tax credit for career extension
- Home buyers’ tax credit
Additionally, the following amounts have been raised:
- Amount for a child under 18 enrolled in post-secondary studies
- Amount for other dependents
- Maximum amount transferable by a child 18 or over enrolled in post-secondary studies
- Amount used to calculate the tax credit for volunteer firefighters and search and rescue volunteers
More about Quebec tax credits
Consent to receiving correspondence online only
Quebec residents have the option to exclusively receive correspondence from us through My Account for individuals whenever feasible. To provide your consent, mark checkbox 10.2 on your income tax return form and input your email address on line 10.1.
More about Revenu Quebec online correspondence
COVID-19 pandemic expenses related to remote work
Starting in 2023, claiming deductions for expenses associated with remote work due to the COVID-19 pandemic is no longer permitted. The deduction previously available on line 207 (point 10) has been removed, per Revenu Quebec.
Nevertheless, if you were a salaried employee or earned commissions during the year, you can still deduct specific expenses mandated by the terms of your employment contract.
More about COVID-19 remote work expenses in Quebec
First Home Savings Account (FHSA)
If you contributed to an FHSA, you may be entitled to a deduction. Additionally, any amount you withdrew from an FHSA may have to be included in your income, Revenu Quebec said.
More about the First Home Savings Account
Tax credits respecting the work premium
As of 2023, Quebec residents are eligible to claim the adapted work premium if either you or your spouse received benefits under the Basic Income Program from the Ministère de l’Emploi et de la Solidarité sociale as of December 31.
More about tax credits respecting the work premium
Amount for a person living alone
Starting in 2023, if you’re benefiting from the Basic Income Program and receive a monthly adjustment tailored for a single individual alongside the basic benefit, you may qualify for the amount designated for a person living alone (subject to certain conditions).
Per Revenu Quebec, if granted and if these benefits constituted your sole income for the year, you will owe no income tax for the tax year 2023.
More about persons living alone in Quebec
Property flipping (home or rental property)
Starting in 2023, if you sell, transfer, exchange, give, or otherwise dispose of a residential property (including rental property or a right to purchase) that you’ve owned for less than 365 consecutive days without any justifiable life event prompting the disposition, Revenu Quebec will categorize this action as property flipping.
More about business income in Quebec
Québec prescription drug insurance plan
Effective July 1, 2023, the contribution rates for the Québec prescription drug plan were raised, and the maximum premium increased from $710 to $731. Consequently, the maximum premium for 2023 stands at $720.50, per Revenu Quebec.
You are exempt from paying the premium under the following circumstances:
- If you were unmarried on December 31, 2023, and the amount on line 275 of your tax return is $18,910 or less.
- If you were married on December 31, 2023, and the combined amount on line 275 of your tax return and your spouse’s tax return is $30,640 or less.
- If you were born before January 1, 1958, and your monthly Guaranteed Income Supplement (GIS) payments total at least 94% of the maximum for the year without considering the top-up benefit.
The calculation of the Québec prescription drug insurance plan premium excludes the months during which you or your spouse received benefits under the Basic Income Program and held a valid claim slip issued by the Ministère de l’Emploi et de la Solidarité social.
More about the Quebec prescription drug insurance plan
Full indexation of the tax system
Per Revenu Québec, a number of other amounts have been increased, including the following:
- the deduction for workers (line 201);
- the basic personal amount (line 350);
- the income thresholds at which certain tax credits are reduced;
- the amount for a person living alone (line 20 of Schedule B);
- the age amount (line 22 of Schedule B); and
- the basic exemption for calculating the contribution to the health services fund (Schedule F).
More about Quebec income tax
Electronic payment of balances due
Per Revenu Quebec, if your balance due is over $10,000, you must pay it electronically (for example, online or through a financial institution).
More about due balances in Quebec
This article’s cover image was used for illustrative purposes only.