Taxation

Consumer Taxes

In Québec, two types of taxes are applied to goods and services. The 5% federal goods and services tax (GST) and the 7.5% Québec sales tax (QST). The latter applies to the selling price including GST.

Consumer taxes are assumed by the consumer. Accordingly, both self-employed workers and companies are generally entitled to a refund credit for the GST paid to purchase goods and services required for business purposes.

Personal Income Tax

Montréalers are subject to income tax imposed by the federal and Québec governments and established according to a table of progressive rates. Individuals are taxed on their income from all sources. However, they are entitled to a variety of personal exemptions, specifically for dependants and income tax paid abroad.
Taxation agreements designed to avoid double taxation have been signed with certain countries.

Foreign Workers

Foreign workers are entitled to the same personal exemptions available to Québec taxpayers, in addition to exemptions for income tax paid abroad. Also, foreign researchers and experts who participate in a company’s research and development activities are entitled to a variable five-year tax holiday on provincial income tax.