443 – Special taxes and tax adjustment

Special taxes payable

If you have to pay any of the following special taxes, enter the amount payable on line 443. In box 442, enter the corresponding number from the list below. If you have to pay more than one special tax, enter the total on line 443 and “55” in box 442.

01Special tax related to the Québec education savings incentive (QESI)
02Special tax related to a registered education savings plan (RESP)
03Special tax related to the non-purchase of replacement shares in a labour-sponsored fund
04Special tax on split income of a child
05Special tax on amounts from an income-averaging annuity for artists
06Other special taxes

1. Special tax related to the Québec education savings incentive (QESI)

If the educational assistance payments (EAPs) you received included QESI amounts totalling more than the $3,600 cumulative limit, you must pay a special tax equal to the excess QESI amount you received. Enter the excess amount on line 443. You can claim a deduction on line 250 for the special tax you must pay.

2. Special tax related to a registered education savings plan (RESP)

You may have to pay a special tax if you are the subscriber under an RESP, or the subscriber's spouse, former spouse or heir, and you received RESP accumulated income payments. Such amounts are identified by the code RV in the “Code (case O)” box of the RL-1 slip. To calculate the amount of the tax, complete form TP-1129.64-V, Special Tax Relating to a Registered Education Savings Plan. Enclose the form with your return.

3. Special tax related to the non-purchase of replacement shares in a labour-sponsored fund

You must pay a special tax if you redeemed your shares in a labour-sponsored fund in order to participate in the Home Buyers' Plan (HBP) or the Lifelong Learning Plan (LLP) but did not purchase replacement shares by the deadline. Enter the total of the amounts shown in boxes F, L1, L2 and L3 of your RL-10 slip.

4. Special tax on split income of a child

You may have to pay a special tax if you were born after December 31, 1999, and you meet the following requirements:

  • Your income includes taxable dividends on unlisted shares (such income may include a capital gain that is considered a taxable dividend further to the sale of shares to a person with which you were not dealing at arm's length) and other benefits granted to a shareholder with regard to such shares.
  • Your income includes income from a partnership or trust, if the partnership or trust earned the income from a business providing goods or services to a business carried on by a person related to you.
  • Your income includes income from a partnership or trust that derived the income from a business or from the leasing of property, and a person related to you:
    • was actively engaged in the partnership or trust, or
    • held a direct interest in the partnership or held an indirect interest in the partnership through the intermediary of another partnership.

Certain income subject to this special tax may be shown on your RL-15 slip or your RL-16 slip.

You can claim a deduction for this income on line 295 of your return.

For more information, contact us.

5. Special tax on amounts from an income-averaging annuity for artists

If you are including amounts from an income-averaging annuity for artists in your income and income tax was deducted at source from the annuity, you must pay a special tax. Enter the amount shown in box C-9 of your RL-2 slip.

However, under certain conditions, you may be entitled to the tax credit for income from an income-averaging annuity for artists. For more information, see point 19 in the instructions for line 462.

6. Other special taxes

Enter on line 443 of your return any other special taxes that you must pay and that are not listed above (only the most common ones are listed). Other special taxes include:

  • the special tax relating to the tax credit for an on-the-job training period;
  • the special tax relating to the tax credit for the reporting of tips;
  • the special tax on an excess amount from a profit-sharing plan (to calculate this special tax, complete form TP-1129.RI-V, Special Tax on an Excess Amount Under a Profit-Sharing Plan).

Tax adjustment

Retroactive payments and support-payment arrears

If you received a retroactive payment in 2017 and a portion of the payment (at least $300) applies to previous years, we can, at your request, determine whether it is to your advantage to average that portion of the payment. If it is, we will calculate the income tax payable on that portion of the payment as if you had received it in the previous years in question and deduct it from your taxable income for 2017. We will then enter a tax adjustment on line 443.

We can average the following amounts:

  • employment income received further to a court judgment, an arbitration award or a settlement between the parties in legal proceedings (line 101 or line 107);
  • wage loss replacement benefits (line 107);
  • a retroactive payment that you are required to include on line 110, 111, 114, 119, 122 or 147;
  • interest on a retroactive payment (line 130);
  • support-payment arrears that you are required to report on line 142;
  • a retroactive payment of labour adjustment benefits and income assistance benefits (line 154);
  • any retroactive payment included on line 154 that would, in the opinion of the Minister of Revenue of Québec, be an undue additional tax burden if you were to include the amount in your taxable income for the year;
  • a retroactive payment of the Universal Child Care Benefit (line 278); and
  • earnings loss benefits, supplementary retirement benefits and career impact allowances (formerly “permanent impairment allowances”) paid under the Canadian Forces Members and Veterans Re-establishment and Compensation Act (line 101).

If you want us to do the calculation, check box 404 on your return, complete form TP-766.2-V, Averaging of a Retroactive Payment, Support-Payment Arrears or a Repayment of Support, and enclose the form with your return. If you complete Part 4 of the form, check box 405 on your return.

Note

We cannot average your retroactive payments in the following cases:

  • You received a payment of a compensation adjustment under the Pay Equity Act.
  • During the year, you received a retroactive payment that you are deducting in the calculation of your taxable income (for example, a retroactive payment of income replacement indemnities or compensation for the loss of financial support).
  • You are transferring a portion of a retroactive payment of eligible retirement income to your spouse (your spouse on December 31, 2017). Neither you nor your spouse can have the transferred portion of the retroactive payment averaged.

Retroactive payments of income replacement indemnities

If you received a retroactive payment of income replacement indemnities that you must report on line 148 and a portion of the payment applies to previous years, one or more amounts will be shown in box O of your RL-5 slip. We will calculate the income tax that you would have paid had you received the indemnities in those previous years and enter a tax adjustment on line 443 of your 2017 income tax return.

Repayment of support

If you received a repayment of support that you must report on line 142 and a portion of the repayment applies to previous years, we can, at your request, determine whether it is to your advantage to average that portion of the repayment. If it is, we will calculate the income tax payable on that portion of the repayment as if you had received it in the previous years in question and deduct it from your taxable income for 2017. We will then enter a tax adjustment on line 443.

If you want us to do the calculation, check box 404 on your return, complete form TP-766.2-V, Averaging of a Retroactive Payment, Support-Payment Arrears or a Repayment of Support, and enclose the form with your return. If you complete Part 4 of the form, check box 405 on your return.

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