2008 Quebec Budget Impact Paper

This paper was prepared by the Compensation Sector, Accounting, Banking and Compensation Branch, Public Works and Government Services Canada (PWGSC). It should be noted that this document is not all encompassing. Employees may find this document informative from a personal perspective.

The following items, which are relative to the compensation product, were introduced in the Quebec budget speech that was presented by Monique Jérôme-Forget, Minister of Finance for the Government of Quebec on March 13, 2008.


ITEMS AFFECTING PWGSC COMPENSATION SYSTEMS

Personal tax credits

Amount with respect to age

The amount with respect to age tax credit of $2,200 be will be indexed automatically each year as of January 1, 2009.

Amount for retirement income

The amount for retirement income tax credit will be increased from $1,500 to $1,750 for the 2009 taxation year, and from $1,750 to $2,000 for the 2010 taxation year. In addition, the amount will be indexed automatically each year as of the 2011 taxation year.

Impact: Information concerning the changes to these tax credits will be communicated to employees paid through the Regional Pay System and the Royal Canadian Mounted Police Pay System. This information will be communicated in an Information Notice to Employees in December 2008, and posted on the Compensation Sector Web site. In order to take advantage of the increase, employees will be required to complete a new Quebec TP-1015.3-V form. As the PWGSC Annuitant System records each tax credit shown on the TP-1015.3-V form separately, this system will be programmed to automatically increase these tax credits effective January 1, 2009.


ITEMS OF INTEREST

The budget introduced a new refundable tax credit of up to $1,560 for respite expenses of informal caregivers. The credit is effective for the 2008 taxation year.

Impact: This credit will be incorporated into the 2008 income tax and benefit return.

Effective January 1, 2009, the $1,000 deduction for workers and the $1,000 exemption for emergency services volunteers will be annually indexed.

Impact: This increase will be incorporated into the 2009 income tax and benefit return.


OTHER

Quebec's tax legislation and regulations will be amended to incorporate some of the measures announced in the February 26, 2008 Federal budget including the implementation of a new savings vehicle, a tax-free savings account (TFSA) effective for the 2009 taxation year and an increase in the maximum Northern Residents Deduction effective for the 2008 taxation year.

To review the March 13, 2008 Quebec budget documents, please visit this site:

http://www.budget.finances.gouv.qc.ca/budget/2008-2009
/index_en.asp