Published | Category : Source deductions and contributions
Increased Tax Credit Rate for the Acquisition of Shares in Fondaction to Be Temporarily Maintained
On June 1, 2015, the rate of the tax credit for the acquisition of shares issued by Fondaction was set at 20%.
In the Budget Speech delivered on March 27, 2018, the Minister of Finance of Québec announced that the rate of the tax credit would be maintained at 20% for all eligible shares acquired after May 31, 2018, but before June 1, 2021. Therefore, if an employee has authorized you to withhold an amount from his or her pay for the purchase, after May 31, 2018, of class A or B Fondaction shares, you must use the 20% rate to calculate the amount of income tax to withhold for any pay period during which such shares were purchased.
If you use the Source Deduction Table for Québec Income Tax (TP-1015.TI-V) to determine the amount of income tax to withhold, you must subtract from the remuneration paid to the employee 100% of the amount deducted for the purchase, after May 31, 2018, of class A or B Fondaction shares.
However, if you use the formulas in the guide Formulas to Calculate Source Deductions and Contributions (TP-1015.F-V), you must subtract from the income tax payable for the year 20% of the amount deducted for the purchase, after May 31, 2018, of class A or B Fondaction shares.