Contributions Payable by Indians to the Québec Pension Plan
All workers 18 or over must pay Québec Pension Plan (QPP) contributions, even in the following situations:
- They receive a retirement pension under the QPP or under the Canada Pension Plan (CPP).
- They are 70 or older.
The QPP provides pension income to employees who retire or become disabled. If an employee dies, the QPP pays benefits to the employee's spouse or dependants. The QPP is equivalent to the CPP.
As an Indian, you do not have to make contributions to the QPP on employment income that gives entitlement to the deduction for employment income situated on a reserve or premises, unless your employer irrevocably elected to participate in the QPP for all of the employer's Indian employees who are resident in Canada and whose work in Québec is excluded from the QPP because of a tax exemption.
You may, however, elect to make an optional contribution to the QPP on your employment income that gives entitlement to the deduction on line 293 of the personal income tax return and from which a contribution to the QPP was not withheld. For more information, see Schedule U on the Income Tax Return, Schedules and Guide page.
Self-employed person
If you are an Indian and you are self-employed, you must complete Schedule U or form LE-35-V, Contribution and Deduction Related to the QPP or the CPP, as applicable, taking into account:
- on line 30 of Schedule U or line 31 of form LE-35-V, the net business income that gives entitlement to a deduction on line 293, if you elect to make a contribution to the QPP on this income;
- on line 31 of Schedule U or line 32 of form LE-35-V, the pensionable earnings you received as a person responsible for a family-type resource or an intermediate resource that constitute income situated on a reserve or premises, if you elect to make a contribution to the QPP on such earnings;
- on line 32 of Schedule U or line 33 of form LE-35-V, the employment income that gives entitlement to a deduction on line 293, on which a contribution to the QPP was not withheld and for which you elect to make an optional contribution to the QPP.
Effective January 1, 2024, workers 65 or older can choose to stop contributing to the Québec Pension Plan (QPP), provided they receive a QPP or CPP retirement pension.
In addition, the obligation to contribute to the QPP has ended for workers over 72, for all workers subject to the contribution provided for by the Act respecting the Québec Pension Plan.
For details, see the Tax News article.