Québec and Ontario Taxes: Key Differences

What are the main differences between Québec and Ontario taxes?

The tax systems in Québec and Ontario differ in many respects. Here is what you need to know if you move from one province to the other.

Last year, Martin (a fictional example) finally secured his dream job as an aeronautical engineer at a large company in Montréal. He and his partner therefore left their hometown of Sudbury, in northern Ontario, to settle permanently in Québec's largest city.

In addition to discovering life in Montréal, Martin will also, for the first time, have to file a provincial income tax return. Unlike Ontario residents, who file a single income tax return with the Canada Revenue Agency (CRA), Québec residents must file two: one with Revenu Québec and one with the CRA.

However, this is not the only difference between the tax systems of the two provinces. Here are a few others:

Number of income tax returns to file

Québec: 2

Ontario: 1

Government authority responsible for income tax returns

Québec: Revenu Québec for provincial income tax, Canada Revenue Agency for federal income tax

Ontario: Canada Revenue Agency for both federal and provincial income tax

Tax forms

Québec: Federal T-slips AND Québec RL slips. Québec has a wide range of RL slips. The RL-1 (Relevé 1) reports employment income and payroll deductions (deductions at source) for the year. Other examples include the RL-2 (pension and retirement income), RL-3 (investment income of $50 or more), and RL-6 (parental benefits), among others.

Ontario: Federal T-slips. These are also numerous. The T4 reports employment income and payroll deductions. T5 slips report investment income. The T3 slip includes other income such as trust income, dividends from Canadian corporations, capital gains, and more.

Tax credits and other key benefits

Québec: Solidarity tax credit (for low- and middle-income households); tax credit for a person living alone; tax credit for labour-sponsored funds (e.g. Fonds de solidarité FTQ or Fondaction CSN); refundable childcare expenses tax credit (based on family income); and others.

Ontario: Ontario Trillium Benefit (combines credits for energy costs, sales tax, and property tax); Low-income Individuals and Families Tax (LIFT) Credit; political contribution tax credit; Ontario Childcare Access and Relief from Expenses (CARE) tax credit; and others.

Québec and Ontario tax brackets

When filing his first Québec income tax return, Martin will notice that the income tax payable is higher in Québec than in Ontario.

“This is mainly because certain public services are more generous in Québec than in other Canadian provinces, such as subsidised childcare centres, the public prescription drug insurance plan, and the Québec Parental Insurance Plan,” explains Jin Woo Kim, tax specialist at TurboTax.

Québec has four tax brackets. The 2025 tax rates based on taxable income are:

$53,255 or less	14%, plus
$53,255.01 to $106,495	19%, plus
$106,495.01 to $129,590	24%, plus
Over $129,590	25.75%

Ontario, for its part, has five tax brackets. The 2025 tax rates based on taxable income are:

$52,886 or less	5.05%, plus
$52,886.01 to $105,775	9.15%, plus
$105,775.01 to $150,000	11.16%, plus
$150,000.01 to $220,000	12.16%, plus
Over $220,000	13.16%

For an accurate comparison, the Québec abatement must be taken into account, as it reduces the federal income tax payable by Québec residents.

The impact of your tax residency status on your income tax return

• Your tax residency status determines whether you must file a Québec income tax return. Revenu Québec considers several factors to determine whether you are a resident of the province for tax purposes.
  The most important factor is your residential ties to Québec. In general, if you resided in Québec on 31 December of a given tax year, you must file a Québec income tax return.
  Residential ties fall into three categories: significant ties (home, spouse, dependants), secondary ties (seasonal residence, personal property, economic ties, etc.), and other ties (post office box, safety deposit box, etc.).
  For example, Martin owns a home in Montréal where he lives with his partner and has economic ties to Québec (his employment), and must therefore file a Québec income tax return.
• What would be the situation if Martin had resided in Ontario while his employer was in Québec? Martin would generally pay tax to the province where he resided on 31 December, namely Ontario. However, his employer would withhold Québec income tax at source (at the higher Québec rates). He would then claim a refund of the difference on line 43700 of his federal income tax return.
  Conversely, if Martin resided in Québec while working in Ontario, he would generally have to file a Québec income tax return.
• Québec residents must file two income tax returns, one with Revenu Québec and one with the Canada Revenue Agency (CRA). Residents of Ontario (and other provinces and territories) file a single return with the CRA, which then allocates the appropriate amounts to the provinces and territories.
• Moreover, a Québec taxpayer who fraudulently declares a principal residence in Ontario in order to pay less tax exposes themselves to serious consequences. “Everyone must pay their fair share of taxes. Those caught by the tax authorities engaging in fraud should expect to face penalties and interest,” says Jin Woo Kim.

Filing deadlines in Québec and Ontario

In both provinces, income tax returns must be filed by 30 April of the following year, or by 15 June for self-employed individuals. Failure to comply results in penalties. Note for self-employed individuals: any tax owing must be paid by 30 April, even though the filing deadline is 15 June.

Avoiding double taxation in Canada

From a tax perspective, certain situations may result in you being considered a resident of Québec even if you do not live there full-time. For example, if you stay in the province for at least 183 days in a taxation year, whether in a single stay or over several stays, you are considered a deemed resident of Québec. You must therefore file an income tax return with Revenu Québec, reporting your worldwide income during the taxation year.

A similar rule applies across Canada: if you are physically present in Canada for more than 183 days in a year, you may be required to pay Canadian income tax.

Tax credits and relief for Québec residents working in Ontario

As a general rule, if you are a resident of Québec, you must file an income tax return in Québec, even if you work in Ontario and even if your employer has withheld income tax at source as though you were an Ontario resident. When filing your Québec income tax return, you must checkmark box 95 to indicate that you earned income outside Québec but within Canada, for example in Ontario. You must then report the amount of that income on line 101.

Since your Ontario employer has likely withheld federal income tax from your pay as though you were an Ontario resident, you are entitled, as a Québec resident, to a transfer of tax of up to 45% of the amount withheld.

Calculate 45% of the income tax deducted (as shown on your T4 slip) and report the result on line 454 of your Québec return. This amount will be treated as Québec income tax withheld at source.

Tax credits and relief for Ontario residents working in Québec

Conversely, if you are an Ontario resident who works in Québec, you must file your income tax return in Ontario. However, your Québec employer will have withheld both federal and Québec provincial income tax from your salary, as though you were a resident of Québec. You may then claim the total amount shown in the “Income tax deducted” box on all your Canadian information slips on line 43700 of your federal income tax return.

How to file your income tax return in Québec vs Ontario

In both Québec and Ontario, the fastest and most convenient way to file your income tax return is electronically, online. In Québec, returns are filed through NetFile Québec. In Ontario, returns are filed with the Canada Revenue Agency through NetFile.

Peace of mind with TurboTax

Make sure your Québec income tax return is completed properly with TurboTax. TurboTax gives you options: you can prepare your return yourself or with help from TurboTax experts, who will help you make the most of your credits and deductions. Or you can have one of our tax experts handle your return from start to finish.

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