Foreign Employees Entitled to a Five-Year Tax Exemption

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A person (hereinafter referred to as an “employee”) who is not resident in Canada and who comes to Québec to work as a foreign specialist, a foreign researcher, a foreign expert, a foreign professor or a foreign researcher on a post-doctoral internship is entitled to a full or partial tax exemption for a continuous period of five calendar years. The exemption applies to the employee's salary or wages, or to all the employee's income, as applicable. The exemption consists in a deduction in the calculation of taxable income.

An employee is entitled to only one five-year exemption period, even if he or she holds more than one type of employment giving entitlement to the exemption.

Requirements

An employee can claim a deduction in the income tax return only if you have obtained a certificate or a qualification certificate for the employee from the government body responsible for issuing the certificate or qualification certificate.

You must file the application for a certificate or a qualification certificate with the issuing government body by the last day of February of the year following the year for which the employee is claiming the deduction. For example, an application for a certificate for 2020 must be filed by February 28, 2021.

You must give the employee a copy of the certificate or qualification certificate.

Foreign employee who spends more than 182 days in Québec before taking up his or her employment duties

A foreign employee who spends more than 182 days in Québec in a year is deemed to be resident in Québec throughout the year. However, this rule does not apply for the purposes of determining whether a foreign employee was resident in Canada immediately before taking up his or her employment duties.

Example
If a foreign employee was in Québec from March 1 to September 1 of a given year (a period of more than 182 days) and started to work on October 1 of that year, the employee is not deemed to have been resident in Québec since January 1 of that year. Consequently, the employee was not resident in Canada before taking up employment duties on October 1.

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