Taxation and Taxes
Quebec tax glossary: 20 accounting terms explained simply
July 23, 2026
At a Glance. Twenty terms come up time and time again in the tax affairs of a Quebec business: the T2 and CO-17 (a corporation’s two tax returns), BNR (retained earnings), CCA (tax depreciation), the tax instalment (tax paid in advance), the source deductions, the 5% GST and the 9.975% QST, the ITC and the ITR, the SBD, and a dozen others. This glossary defines each term in 40 to 60 words, in clear, plain French, and links each concept to the free calculator or Bankeo guide that demonstrates its practical application. All amounts are in Canadian dollars.
In Quebec, business owners have to navigate two tax agencies, the CRA at the federal level and Revenu Québec at the provincial level, and therefore deal with a dual vocabulary: T2 and CO-17, T4 and RL-1, ITC and ITR. The acronyms pile up quickly, and conversations with your accountant can sound like a foreign language. This glossary brings together 20 tax and accounting terms that every Quebec SME owner or self-employed individual will encounter at one time or another. Each entry is 40 to 60 words long and links to a free calculator or guide that puts the concept into practice. For recent changes affecting these concepts, see also our 2026 Tax Changes for Quebec SMEs.
Before we get to the definitions, here are the 2026 rates, thresholds, and deadlines related to these 20 terms. These are the figures you’ll want to keep handy.
| Term | Key Figure (2026) | Administration |
|---|---|---|
| GST | 5% | Revenu Québec (which administers it in Quebec) |
| QST | 9.975% | Revenu Québec |
| Small Supplier | $30,000 in taxable sales over 4 quarters | CRA and Revenu Québec |
| SBD | 9% federal tax on the first $500,000 | CRA |
| Tax Instalments (Individuals) | Net tax of more than $3,000 (federal) or $1,800 (Quebec) | CRA and Revenu Québec |
| T2 and CO-17 | to be filed within 6 months after the end of the fiscal year | CRA and Revenu Québec |
| T4 and RL-1 | Due no later than the last day of February | CRA and Revenu Québec |
| HSF | 1.25% to 4.26% of total payroll | Revenu Québec |
Five terms define the tax structure for a corporation incorporated in Quebec, from the annual tax return to the management of retained earnings.
Form T2 is the federal income tax return that every corporation must file with the CRA each year, even if no tax is due, within six months after the end of its fiscal year. Estimate your corporation’s combined tax liability using the Corporate Tax Calculator.
Form CO-17 is the Quebec equivalent of Form T2: the tax return that every corporation subject to Quebec income tax files with Revenu Québec. A corporation operating in Quebec therefore files two separate returns each year, with the same filing deadlines. The Corporate Tax Calculator combines the two levels of taxation.
The small business deduction lowers the federal tax rate to 9% on the first $500,000 of eligible income for a Canadian-controlled private corporation. In Quebec, the reduced rate requires, among other things, 5,500 hours of paid work. Check your actual rate with the Corporate Tax Calculator.
Retained earnings are the profits a company retains after taxes and dividends, accumulated since its inception. They are reported under shareholders’ equity on the balance sheet and are used to fund future growth or dividends. To decide whether to distribute or reinvest them, read our guide salary or dividends.
Capital cost allowance is the tax equivalent of depreciation: each asset (equipment, vehicle, building) belongs to a category for which the CRA sets the maximum deductible rate each year. It replaces accounting depreciation on your tax returns. Identify your eligible expenses with the Deductible Expense Calculator.
Sales taxes have their own terminology, and in Quebec, they all go through a single agency: Revenu Québec.
The Goods and Services Tax (GST) is the 5% federal sales tax on most goods and services. A unique feature in Quebec is that Revenu Québec, not the CRA, administers it within the province. Calculate an amount with or without taxes using the GST/QST calculator.
The Quebec sales tax is 9.975% of the sale price, calculated on the same tax base as the GST, and is never applied on top of the GST. Combined, the GST and QST account for approximately 14.975% of the total bill. The GST/QST calculator calculates it both ways.
The input tax credit allows a registered business to recover the GST paid on its business purchases: rent, equipment, software, and professional fees. You only remit the net tax collected. Our GST/QST Guide for Businesses lists the required supporting documents.
The Input Tax Rebate is the Quebec equivalent of the ITC: it allows you to recover the QST paid on your business expenses. The ITC and ITR are claimed together on the same tax return filed with Revenu Québec. Exceptions and restrictions are detailed in the GST/QST Guide.
Status of a business whose taxable sales remain below $30,000 for four consecutive calendar quarters: Registration for the GST and QST remains optional during this period but becomes mandatory once the threshold is exceeded. Our article on the $30,000 threshold explains when and how to register.
In Quebec, Revenu Québec administers both the GST and the QST: you file a single tax return for both, and Revenu Québec also processes your ITCs and ITRs. There’s a single point of contact for sales taxes, but there are still two (the CRA and Revenu Québec) for income tax.
From the moment you hire your first employee, or as soon as you pay yourself a salary as an executive, these five terms become part of your daily routine.
Payroll source deductions are the amounts withheld from each paycheck (federal and provincial income tax, QPP, QPIP, and employment insurance) that the employer remits to the CRA and Revenu Québec according to a strict schedule. Calculate the total cost of hiring an employee with the Employer Cost Calculator.
The Quebec Pension Plan is the public pension plan for Quebec workers, which replaces the CPP in the rest of Canada. Employers and employees each contribute up to the maximum eligible earnings; self-employed individuals pay both shares. Its weight is reflected in the Employer Cost Calculator.
The Quebec Parental Insurance Plan funds maternity, paternity, parental, and adoption benefits. Unique to Quebec, it is in addition to other deductions: both the employee and the employer each contribute their respective rates based on insurable earnings. One more line item than the Employer Cost Calculator automatically integrates.
The Health Services Fund is a Quebec employer contribution calculated based on total payroll, at a rate ranging from approximately 1.25% to 4.26%, depending on the business’s size and industry. It is the employer cost most often overlooked; the Employer Cost Calculator provides for this automatically.
A "determined" dividend comes from income taxed at the corporation’s general tax rate and entitles the shareholder to an enhanced tax credit; a "non-determined" dividend, derived from income taxed at the SME tax rate, offers fewer tax benefits. Compare the compensation scenarios using the Salary vs. Dividend Calculator.
The last five terms cover deadlines and paperwork: who files what, when, and in what format.
Advance tax payments made throughout the year rather than in a single lump sum in the spring. Individuals generally make these payments when their net tax liability exceeds $3,000 at the federal level or $1,800 in Quebec; corporations pay in monthly or quarterly instalments. Estimate your tax bill with the Individual Tax Calculator.
Forms provided to each employee after the end of the year, the T4 (federal, for the CRA) and RL-1 (provincial, for Revenu Québec), summarize wages paid and withholdings made. They must be submitted by the last day of February at the latest. The complete schedule is available in our Guide to Year-End Tax Forms.
A period of up to 53 weeks over which a company calculates its earnings and taxes. The fiscal year-end date, chosen at the time of incorporation, triggers all filing deadlines: T2 and CO-17 within six months, and the tax balance must be paid before then. Find all the dates in our Guide to Annual Filing Requirements.
Formerly known as a “notice to reader,” this is the most common type of financial statements prepared by a CPA for an SME, governed by NCSC 4200 since 2021. It provides no audit assurance, but is often sufficient for lenders. Learn how to read these statements with our guide Understanding Your Financial Statements.
The Quebec business number is the 10-digit identifier assigned by the Registraire des entreprises upon registration. It is used for all your provincial transactions and is distinct from the federal business number (BN) issued by the CRA. Our Guide to Registration with the Registrar explains how to get it.
How much does it cost to hire an accountant to handle all this jargon for you? The median fee is around $3,000 per year, with most engagements ranging from $500 to $6,000 depending on the industry, based on actual fees from 1,248 engagements completed through Bankeo (2024-2026), out of more than 15,000 requests received. The Bankeo Fee Barometer breaks down these fees by service, and you can browse the Vetted accountants in the Network to compare profiles.
Bankeo connects you for free with vetted accountants from its network of over 1,500 partners. Explain your situation once: we’ll find the right match, often within 48 hours, and we’ll support you every step of the way. Free, with no obligation.
Find my accountantForm T2 is the federal corporate income tax return filed with the CRA; Form CO-17 is its provincial equivalent, filed with Revenu Québec. A corporation operating in Quebec must file both forms each year, within six months after the end of its fiscal year, even if it has no tax due.
BNR stands for retained earnings: the profits a business has accumulated since its inception, minus taxes paid and dividends paid out. It is a key line item on the balance sheet, as it indicates the business’s ability to reinvest, weather a downturn, or pay dividends to shareholders.
An individual in business is generally required to make tax instalments when their net tax liability exceeds $3,000 at the federal level or $1,800 in Quebec for the current year and one of the two preceding years. Corporations, on the other hand, make monthly or quarterly payments as soon as their annual tax liability exceeds $3,000.
Accounting depreciation allocates the cost of an asset according to the business’s policy in its financial statements. Capital cost allowance (CCA) is its tax equivalent: maximum rates set by the CRA for each asset category. The two amounts almost always differ, which explains part of the discrepancy between accounting profit and taxable income.
The ITC recovers the GST paid on your business purchases; the ITR recovers the QST on the same purchases. Both are claimed on the same tax return, filed with Revenu Québec, which administers both taxes in Quebec. You therefore only pay the difference between the taxes collected and the taxes paid.
According to the Bankeo Fee Barometer, the median fee is around $3,000 per year, with most engagements ranging from $500 to $6,000 depending on the sector and the scope of services. These figures are based on the actual fees for 1,248 engagements completed through Bankeo (2024-2026), out of more than 15,000 requests received.
General information provided for informational purposes only, based on known 2026 tax rules. It is not a substitute for the advice of a Chartered Professional Accountant (CPA): always consult a professional regarding your specific situation.
The Bankeo matching service is 100% free, always. You only pay your accountant directly.
We’ll connect you with the right accountant from our network to meet your needs, we have as many profiles as you need.
We’ll support you for as long as it takes. We’re here for you every step of the way.
Your request will be processed within 2 business days.
