ARCHIVED CD 1996-021

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April 25, 1996

Ottawa, Canada
K1A 0S5

SUBJECT: Deductions at Source of Québec Income Tax for Residents of the Province of Québec who work in a province other than Québec

1. PURPOSE

1.1 The purpose of this directive is to provide you with information concerning deductions at source of Québec income tax for employees residing in the province of Québec and working in a province other than Québec.

2. BACKGROUND

2.1 Previously, only employees working and residing in the province of Québec could choose to have an additional Québec income tax deduction at source.

2.2 The Department of Finance Canada and Treasury Board Secretariat have recently agreed to a request from the Ministère du Revenu du Québec , that Québec resident employees, working outside the province of Québec, be offered the option of having a Québec income tax deduction at source.

3. POLICY

3.1 Employees residing in Québec and working in a province other than Québec may now choose to have a predetermined amount of Québec income tax deducted at source and remitted directly to the Ministère du Revenu du Québec .

3.2 This deduction will be considered as an "additional" tax deduction to what is currently being calculated at source on the employee's remuneration payments. Please note that, in accordance with Regulation 102 (1) (a) of the Income Tax Act, the employee's income tax will continue to be calculated on these payments based on the employee's province of work.

3.3 Deduction code 799 "Québec Income Tax Additional Fixed Amount", presently used to deduct Québec income tax for employees residing and working in Québec, will also be utilized to deduct Québec income tax for employees residing in Québec and working in another province other than Québec.

3.4 Code 799 will be deducted from remuneration paid each pay period. Supplementary payments (i.e. overtime payment) are exempt from this provision.

3.5 The amount to be deducted each pay period must be identified by the employee and this amount must be a multiple of 5.

3.6 Treasury Board has requested that departments notify their employees of this new option.

4. PROCEDURES/INSTRUCTIONS

4.1 The employee residing in Québec and working in a province other than Québec who wishes to have a Québec income tax deduction at source should send his/her request, in writing, to his/her personnel office.

The request may also be done by completing either the form TP-1017V "Request to have additional tax withheld at source" or by completing the pertinent section of form MR-19 "Source deductions return". Both forms are available at any office of the Ministère du Revenu du Québec .

4.2 Upon receipt of the written request from the employee, the Compensation Specialist should commence the deduction code 799 for the amount requested by the employee.

4.3 The total amount of Québec income tax deducted during the year will be reported on a Relevé 1.

4.4 Pay offices will remit these deductions to the Ministère du Revenu du Québec as per current procedures.

5. INQUIRIES

5.1 Any request for information regarding the foregoing should be addressed to your Public Works and Governmental Services Canada (PWGSC) Client Services Centre as per Compensation Directive 1994-039 dated October 6, 1994.

Original Signed by
J.A. Boudreau

P. Charko
Director General
Compensation Sector
Government Operational Service

Reference CJA 9007-8, 9007-10-3