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For Which Province do I File a Tax Return?
Under normal conditions, a person files a tax return for the province in which they are residing on December 31 of the taxation year. Sometimes, a person may be considered to be a resident of a province even if they have temporarily relocated to another province. This could happen if the person was employed in a temporary job, or was a student in a province where they do not normally reside. A person will be determined to be resident in the province in which they have the most significant residential ties. For more information on this, see the Canada Revenue Agency (CRA) Income Tax Folio S5-F1-C1: Determining an Individual's Residence Status.
If you're interested in reading a lengthy BC Supreme Court case see Sampson v. British Columbia, 2018 BCSC 1503. This case is about a person who worked in Alberta and rented an apartment there, had an Alberta driver's licence and health care card. However, he had a wife, children and a home in BC. He claimed to reside in Alberta for tax purposes. He was reassessed, and the Court agreed that Mr. Sampson was a resident of BC for tax purposes. Another case where the Court did not agree with the taxpayer, Fono vs. Quebec Revenue Agency, 2018 QCCQ 10534 (CanLii), is explained by Video Tax News. The taxpayer moved from Quebec to Ontario, but did not sufficiently sever residential ties with Quebec.
Tax Tip: If you are moving to a lower tax rate province, do it before December 31st. If you are moving to a higher tax rate province, wait till after December 31st.
What if I live in one province or territory, and work in another, or have paid taxes in two or more provinces?
When it comes time to file your income tax, it doesn't matter if you live in one province or territory and are employed and pay taxes in another. You file your income tax for the province or territory in which you reside on December 31 of the tax year. You will simply add up all of your Canadian T4 slips and/or RL-1 slips from Quebec (Statements of Remuneration Paid), and enter the information on your tax return.
If you have employment income and deductions from Quebec, but reside in another province, you will not file a Quebec tax return, but will file your return for your province of residence. You will include your Quebec provincial income tax on line 43700 (line 437 prior to 2019) of your tax return, as part of total income tax deducted. Any QPP contributions that you paid should be treated on your tax return as if you contributed them to CPP.
You will use our Canadian Tax & RRSP Savings Calculator in this situation, not the Quebec Tax & RRSP Savings Calculator. Add the employment income from the RL-1 and the T4 (if any) and enter the total employment income in that field of the calculator. You will total the income tax paid from both the RL-1 and the T4 (if any) and enter this amount in the "Total income tax deducted (information slips/instalments) - not CPP/EI premiums" area. The calculator will calculate the amount of CPP and EI which you should have paid, and you can compare this to what was actually paid to determine any amount payable or recoverable. The CPP and EI (or Quebec equivalents) are not entered into the calculator.
If you are using tax software to file your tax return (recommended), it will most likely provide separate input areas for T4s and for Quebec Releve 1 forms. If you are not using tax software, you can look at both forms - T4 slip and Releve-1 slip (RL-1) to see which boxes are for the same amounts.
Quebec Residents With Employer in Another Province
Because Quebec residents must file separate federal and provincial tax returns, there is one more step for Quebec residents who paid tax in another province. If income tax was paid to another province or territory, you may request a tax transfer to the province of Quebec to offset your Quebec provincial taxes payable. You may transfer up to 45% of the tax shown on information slips from payers outside of Quebec. This is done by entering the desired transfer amount on line 43800 (line 438 prior to 2019) of the federal tax return and line 454 of the Quebec tax return.
The above information is available in the CRA General Income Tax and Benefit Guide.
From Revenu Quebec Tax Return Line-By-Line Help:
Line 97 Quebec parental insurance plan (QPIP) premium: If you worked outside Quebec (in Canada or elsewhere), and you did not receive an RL-1 slip for that employment, complete Schedule R to find out whether you must pay a QPIP premium.
Line 101 Employment income: You must include on line 101 the employment income you earned outside Quebec, and:
The Quebec Tax Calculator shows, near the bottom of the calculator, "QPIP paid on employment income". If you worked outside Quebec, did not pay QPIP premiums, and have determined that you are required to pay them, you will have to add this QPIP amount to your "Total Federal and QC balance payable (refund if negative)".
If you reside in Canada outside Quebec, but you carried on a business or practised a profession in Quebec, you may have to file a Quebec tax return. See the Quebec Revenue Ministry article "Are you required to file an income tax return?", which lists the situations in which a Quebec tax return must be filed.
Revised: December 20, 2022
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