Living in Quebec: two tax returns and what's different

If you live in Quebec, you deal with two tax administrations. Your federal return goes to the CRA, as it does for everyone in Canada. Quebec administers its own tax laws, so your provincial tax goes on a separate return, the TP-1, filed with Revenu Québec. Here’s what that changes.

Two returns, two sets of rules

The CRA’s tax package for Quebec has the federal return and its schedules; for Quebec tax, it refers you to Revenu Québec’s own return, schedules and guide. Your Quebec tax is worked out on the TP-1, with Quebec’s own rates, credits and schedules. For 2025, Quebec’s rates run from 14% to 25.75% on taxable income over $129,590 (see income tax brackets).

Revenu Québec has its own list of who must file. It includes anyone resident in Quebec on December 31 who has to pay Quebec income tax, a Québec Pension Plan (QPP) contribution, a Québec parental insurance plan (QPIP) premium or a health services fund contribution. It also includes anyone who has to pay a premium under the Québec prescription drug insurance plan, anyone resident in Quebec on December 31 who wants the solidarity tax credit, and anyone who wants to claim credits such as the work premium. See do I need to file? for more.

Most of these rules turn on where you lived on December 31. If you moved into or out of Quebec during the year, see moving to or from Quebec.

The Quebec abatement on your federal return

If you were resident in Quebec on December 31, the federal return gives you a refundable Quebec abatement of 16.5% of your basic federal tax. It reduces what you owe the CRA, and because it’s refundable it can add to a refund. It’s calculated on the return itself, in the refund or balance owing step.

If you had business income and the business has a permanent establishment outside Quebec, you calculate the abatement on Form T2203 instead.

Working outside Quebec: the tax transfer

If you lived in Quebec on December 31 but earned income, such as employment income, outside Quebec, your payer may have withheld tax for another province instead of for Quebec. You can transfer up to 45% of the income tax shown on slips from payers outside Quebec. Claim the transfer on your federal return and the same amount on your Quebec return. If your Quebec taxable income is zero, you don’t need to.

QPP and QPIP instead of CPP and federal parental benefits

QPP. If your province of employment is Quebec, wherever you live, your employer deducts QPP contributions instead of CPP contributions. For 2025, the employee rate is 6.4% of earnings above $3,500, up to $71,300, plus 4% on earnings above that, up to $81,200.

QPIP. Quebec administers maternity, parental and adoption benefits for its residents, through the Québec parental insurance plan. The EI premium rate for Quebec is lower (1.31% for 2025, against 1.64% elsewhere), and you also pay a QPIP premium: 0.494% of insurable earnings up to $98,000 for 2025. If you’re self-employed, or you worked outside Quebec and didn’t get an RL-1 slip for that job, you complete Schedule R of your Quebec return to work out whether you owe a QPIP premium on that income.

Your federal return still gives you non-refundable credits for your base QPP contributions and your QPIP premiums. All the rates are in CPP, QPP, EI and QPIP, and reading your pay stub shows where they appear.

The prescription drug insurance premium

If you have a health insurance card from the Régie de l’assurance maladie du Québec (RAMQ), you must have basic prescription drug insurance: through a group plan if you’re eligible for one, or through Quebec’s public plan if you’re not. As a rule, if you didn’t have basic drug insurance through a group plan, you pay a premium for the public plan on your Quebec return. You work it out on Schedule K, based on your income and, if you had a spouse on December 31, your spouse’s, up to a maximum per person.

• Covered all year by a group plan (yours, or your spouse’s or parent’s)? You don’t fill in Schedule K or pay the premium; enter the number for your situation in box 449 of your return. Other situations, such as being under 18 and unmarried all year or having a low income, can also exempt you.
• Eligible for a group plan but didn’t join? You still owe the premium, and you get no benefits from the public plan.
• Turning 65? Check with your insurer that you still have basic drug insurance at least equal to the RAMQ’s, or you may owe the premium.

Filing Schedule K doesn’t register you for the public plan; for that, contact the RAMQ.

Quebec credits people miss

These are refundable credits, so you can get them even if you owe no tax, but only if you file a Quebec return and claim them.

• Solidarity tax credit. For low- and middle-income families, with a housing component, a QST component and a component for people living in northern villages. Complete Schedule D of your return or claim it in Revenu Québec’s My Account; if you don’t, you get only the basic amount of the QST component (and the spousal amount, if any). As a rule, you must be registered for direct deposit. A couple living together makes one claim. If you didn’t claim it on a return, you have until December 31 of the fourth year after that return’s tax year to claim it, in My Account or with Schedule D and a request for an adjustment.
• Work premium. For people resident in Quebec on December 31 who report work income, such as employment or business income, and whose family income is under a maximum for their situation. You can get it without Schedule P, but completing Schedule P is the only way to make sure you get the full amount. Full-time students can’t claim it unless they had a child living with them on December 31.
• Home-support services for seniors. If you were 70 or older and resident in Quebec on December 31, you can claim a credit for eligible home-support expenses on Schedule J. If you rent in an apartment building, part of your rent counts. Revenu Québec can work out the credit on a minimum rent without Schedule J if it has your information, but if your rent is higher than that, completing Schedule J gets you the full amount. If you and your spouse are both entitled, only one of you claims it for the couple, and the credit is reduced once family income passes a threshold.
• Senior assistance tax credit. If you or your spouse was 70 or older on December 31 and you meet the other conditions, you may qualify. If you have a spouse, they must file a return too.

The Quebec side of our other guides

Many of our guides have a Quebec section:

• How to file your return and slips to gather, including RL slips
• Your tax refund, owing the CRA and tax instalments
• Tuition credits, medical expenses, charitable donations and child care expenses
• Seniors and retirement, caregiver credits and the disability tax credit

If you paid foreign tax, note that Quebec residents don’t complete Form T2036, the CRA’s provincial foreign tax credit form; for Quebec’s own foreign tax credit, see Revenu Québec.

What to do

• File both returns, with your RL slips as well as your federal slips.
• Fill in box 449 or Schedule K for the drug insurance premium.
• Claim the Quebec credits that apply, and register for direct deposit with Revenu Québec.
• If tax was withheld for another province, claim the tax transfer on both returns.