28 January 2002

The following articles will be of particular interest to members with offices in Québec Region. They are from the Fourth quarter 2001 edition of "Tax News", published by the Ministère Revenu du Québec.

These articles are also available to members in the Québec Region page on the members-only accessible area of the CSCB web site. To access this area, log in as a member, click on the "CSCB reference system" bullet , then click on "CSCB Regions", and finally, "Québec".

Important Notice to Small and Medium-Sized Businesses — Deferral of November and December 2001 instalment payments

In September, the government announced that certain corporations will be allowed to defer, interest- free, their instalments for the month of October 2001 until they make their April 2002 instalment payments. The purpose of this measure was to increase the cash flow of small and medium-sized businesses.

A measure aimed at providing additional assistance to these corporations was announced in the Budget Speech of November 1, 2001. Under this measure, the corporations will be able to defer, interest-free, their instalments of income tax, tax on capital, compensation tax and Québec Youth Fund contributions for the months of November and December 2001 until they make their instalment payments for May and June 2002, respectively. The measure applies to corporations whose paid-up capital calculated for the purposes of the tax on capital was $15 million or less for the taxation year preceding the current year; the calculation of paid-up capital must take into account the paid-up capital attributable to associated corporations, including that of corporations not subject to the Taxation Act.

Special measure

Small and medium-sized businesses whose taxation year ends after September 30, 2001, but before April 1, 2002, will have at least six months in which to pay their October, November and December instalments, as well as their balance of income tax and tax on capital. If this situation applies to you, refer to the table below to find out when you will be required to make your payments.

For further information, contact the office of the Ministère du Revenu in your area. You may also
consult the 2002-2003 Budget Speech on the Web site of the Ministère des Finances at http://www.finances.gouv.qc.ca.

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Small Employers: Reduction in the Number of Instalments

To enable small employers to increase their liquid assets in the short term and ease their administrative burden, especially as concerns the number of forms they must submit to the Ministère, amendments will be made to tax legislation to reduce the number of instalments payable for a single year from twelve to four, with regard to remuneration paid after December 31, 2001.

This measure affects employers whose average monthly withholding does not exceed $1,000 for the year preceding a given calendar year in which remuneration will be paid, or the year before that, and who, with regard to deductions at source, employer contributions and sales tax, have acted in compliance with the tax laws.

The MRQ will authorize these employers to remit source deductions and employer contributions no later than

— April 15 of the given calendar year, respecting remuneration paid during January, February and March of that year;
— July 15 of the given calendar year, respecting remuneration paid during April, May and June of that year;
— October 15 of the given calendar year, respecting remuneration paid during July, August and September of that year;
— January 15 of the year following the given calendar year, respecting remuneration paid during October, November and December of that year.

The specific rules that currently apply to very small employers (annual withholding of $1,200 or less) will be maintained; these employers are entitled to continue making a single payment to the MRQ no later than fifteen days after the end of a calendar year during which remuneration was paid.

Employers who meet these conditions for a given calendar year will be

• http://www.finances.gouv.qc.ca