In general, an employee trust is an arrangement that the trustee, pursuant to federal legislation, has elected to qualify as an employee trust, under which an employer remits amounts to the trustee for the benefit of employees.

If you have made such an election, it is automatically deemed to be made for the purposes of Québec legislation. You must send us proof that the election was made with the Canada Revenue Agency (CRA) and written notification no later than the filing deadline for the income tax return or 30 days after the election was made (whichever is later).

The contributions that the employer remits to the trustee can be deducted by the employer only if the election has been made.

To maintain its status as an employee trust, a trust must allocate to its beneficiaries (the employees), each year, all of its non-business income and all employer contributions for that year.

The amounts are allocated as employment income and are taxable for the beneficiaries in the year of the allocation. The trust must report the amounts on RL-1 slips (see courtesy translation RL-1-T), rather than on RL-16 slips. 

The trust must also complete form RLZ-1.S-V, Summary of Source Deductions and Employer Contributions, for these amounts. The RL-1 slips and RLZ-1.S-V form must be filed with us no later than the last day of February of the year following the end of the trust's taxation year.