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Rates, Thresholds and Amounts Related to Source Deductions and Contributions for 2016

The rates, thresholds and amounts applicable to source deductions and contributions for 2016 are described below.

Indexation for 2016 

Every year, the personal income tax system is automatically indexed. The indexation rate for 2016 is 1.09%.

Income tax rates and income thresholds 

For 2016, the income tax rates applicable to the taxable income brackets remain unchanged and the income thresholds for these brackets have been indexed. Specifically:

  • the 16% rate applies to taxable income of $42,390 or less (previously $41,935);
  • the 20% rate applies to taxable income of more than $42,390, but not more than $84,780 (previously $83,865);
  • the 24% rate applies to taxable income of more than $84,780, but not more than $103,150 (previously $102,040);
  • the 25.75% rate applies to taxable income of more than $103,150.

Source Deductions Return (form TP-1015.3-V)

The Source Deductions Return (form TP-1015.3-V) has been revised for 2016 to take into account the indexation of the amounts appearing on it.

The indexed amounts used to determine deduction codes for 2016 are shown in the table below. The figures for 2015 are provided for information purposes.

Amounts to calculate source deductions
20162015
Basic amount$11,550$11,425
Amount transferred from one spouse to the other$11,550$11,425
Amount for other dependants who are 18 or older$3,100$3,065
Amount for a child under 18 enrolled in post-secondary studies$2,130$2,105
Additional amount for a person living alone (single-parent family)$1,675$1,655
Amount for a severe and prolonged impairment in mental or physical functions$2,625$2,595
Amount for a person living alone$1,355$1,340
Age amount$2,485$2,460
Amount for retirement income$2,210$2,185
Reduction threshold used to calculate the net family income (This income is used to calculate the age amount, the amount for a person living alone and the amount for retirement income.) $33,505$33,145
Indexation rate for 20161.09%

Gratuities and retroactive pay 

The threshold for determining the method to be used to calculate the source deduction of income tax from gratuities and retroactive pay has been increased from $14,300 to $14,450 for 2016.

Deduction for employment income 

The maximum deduction for employment income has been increased from $1,120 to $1,130 for 2016.

Emergency services volunteer 

The tax-exempt financial compensation paid to an emergency services volunteer has been increased from $1,120 to $1,130 for 2016.

Maximum pensionable earnings and QPP contribution rate 

For 2016, the maximum pensionable earnings for the purpose of the QPP have been increased from $53,600 to $54,900 and the QPP contribution rate has been increased from 10.50% to 10.65%, which corresponds to a contribution rate of 5.325% for the employee and 5.325% for the employer. The maximum annual contribution to be withheld for any employee has therefore been increased from $2,630.25 to $2,737.05.

Note

Document TP-1015.TR.12-V, Source Deduction Tables for QPP Contributions: 12 Pay Periods, has been eliminated and its contents integrated into document TP-1015.TR-V, Source Deduction Tables for QPP Contributions.

Maximum insurable earnings and QPIP premium rate 

For 2016, the maximum insurable earnings for the purpose of the QPIP have been increased from $70,000 to $71,500. The employee premium rate is 0.548% (instead of 0.559%) and the employer premium rate is 0.767% (instead of 0.782%). As a result, the maximum annual employee premium is $391.82 (instead of $391.30) and the maximum annual employer premium is $548.41 (instead of $547.40).

Maximum remuneration subject to the contribution to the financing of the Commission des normes du travail 

The portion of the remuneration in excess of $71,500 (instead of $70,000) is not subject to the contribution to the financing of the Commission des normes du travail (CNT) for 2016.

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