How to pay less tax in Québec: 2026 year-end tax planning checklist

You pay less tax in Québec by doing three things before the year closes: lowering your taxable income (RRSP, FHSA, business deductions), claiming every credit you are entitled to (medical, donations, childcare, Québec’s refundable credits) and moving income to the lowest-taxed person or year (spousal RRSP, pension splitting, bonus timing). Most of it has to happen by December 31, 2026. This checklist covers individuals and families first, then business owners and the self-employed, with the dates, the 2026 limits and two worked examples.

What changed for 2026?

• Federal rate cut: the lowest federal rate is 14% for 2026, down from 14.5% for 2025. Most federal non-refundable credits, including the first $200 of donations, are now worth 14%.
• Québec indexation: Québec indexed its personal tax system by 2.05% for 2026. The basic personal amount is $18,952.
• Québec childcare credit: the age limit for an eligible child drops from under 16 to under 14 for 2026.
• Québec credits abolished: the credit for political contributions and the “tax shield” credit are gone for 2026. The 30% credit for cultural patronage donations ended for donations made after March 25, 2025.
• Equipment: Ottawa proposed a Productivity Mega Deduction on September 15, 2026, a 100% first-year write-off for most depreciable property acquired on or after that date. It is not law yet (details below).

The 2026 year-end tax checklist (with dates)

Print this or keep it open. Dates assume a December 31 year-end for businesses.

Part A: How to pay less tax in Québec as an individual

Use your RRSP room (deadline March 1, 2027)

An RRSP contribution is a deduction on both your federal return and your TP-1, so it saves tax at your combined marginal rate. Your 2026 deduction limit is 18% of your 2025 earned income, up to $33,810, plus unused room from past years, minus any pension adjustment. The exact number is on your 2025 notice of assessment. Contributions made from January 1 to March 1, 2027 can be deducted on your 2026 return. Going more than $2,000 over your limit costs 1% a month on the excess.

Open and fund an FHSA before December 31

If you qualify as a first-time home buyer, the first home savings account (FHSA) is the best deal in the tax system: deductible going in, tax-free coming out for a qualifying first home. You can contribute $8,000 a year, up to $40,000 over your lifetime, and carry forward up to $8,000 of unused room. There is no 60-day grace period: contributions made in January 2027 cannot be deducted for 2026. Open the account this year even with a small deposit, because room only starts to accumulate once the account exists.

Top up your TFSA, and time your withdrawals

The 2026 TFSA limit is $7,000. TFSA contributions don’t reduce your tax this year, but growth and withdrawals are tax-free. Anything you withdraw is added back to your room on January 1 of the next year, so if you need money in early 2027, withdraw it before December 31, 2026 and you get the room back a year sooner.

RRSP or TFSA: which one saves more at your income?

The RRSP wins when your tax rate today is higher than the rate you expect when you withdraw. The TFSA wins when your rate is low now, when you expect a higher income later, or when you want to protect income-tested benefits in retirement. Approximate 2026 combined federal and Québec marginal rates on salary or other ordinary income:

Rates combine the 2026 federal brackets (after the 16.5% Québec abatement) and the 2026 Québec brackets. Credit clawbacks can push your real rate higher. An RRSP deduction also lowers the family income used for Québec’s solidarity credit, work premium and childcare credit, which can make it worth more than the table shows.

Pay medical expenses in the right 12 months, and pick the right spouse

You can claim medical expenses for any 12-month period that ends in 2026, for yourself, your spouse and your dependants. The two returns work differently:

• Federal: a 14% credit on expenses above the lower of $2,890 or 3% of the claimant’s net income. The lower-income spouse usually gets more, because their 3% threshold is smaller.
• Québec: a 20% credit on expenses above 3% of family income (your income plus your spouse’s). Which spouse claims does not change the threshold.
• Québec refundable credit: if you have at least $3,825 of work income, you may also get up to $1,496 back, reduced by 5% of family income above $28,915.

Group insurance premiums count too. On your RL-1, box J (your employer’s contribution) and code 235 (premiums you paid) can be included in Québec medical expenses. Our RL-1 box-by-box guide shows where they appear.

Make donations by December 31, and pool them

Donations must be made by December 31 to count for 2026. Both governments give a low rate on the first $200 and a high rate above it:

Because the low rate applies once per return, spouses usually save more by claiming all donations on one return. You can also carry donations forward up to five years, which helps if you give a small amount this year and a larger amount next year. Donating listed shares that have gone up in value, instead of selling them first, avoids the capital gains tax on the increase. The federal first-time donor’s super credit only existed from 2013 to 2017, and Québec’s large cultural donation credit ended in March 2025, so don’t count on either.

Childcare and day camps: claim the right amounts

• Federal deduction: up to $8,000 per child aged 6 or under at year-end, $5,000 for a child aged 7 to 16 and $11,000 for a child eligible for the disability amount. The lower-income spouse generally claims it. Overnight camps are limited to $200 a week (6 and under), $125 a week (7 to 16) and $275 a week (disability).
• Québec refundable credit: 67% to 78% of eligible expenses depending on family income (70% between $51,225 and $122,290, 67% above). For 2026, maximum eligible expenses are $12,525 for a child under 7, $6,305 for another eligible child and $17,145 for a child with a severe and prolonged impairment. For 2026, the child must be under 14 (under 16 before).
• Day camps count on both returns. Keep the RL-24 slip your provider gives you; Revenu Québec generally no longer accepts receipts for Québec providers.

Transfer tuition credits from a student child

A student who doesn’t need their tuition credit can transfer up to $5,000 of tuition (federal) to a parent or grandparent. In Québec, the student can transfer all or part of the tuition credit to a parent or grandparent on Schedule T; the parent claims it on line 398.1. Québec also lets an adult full-time student transfer unused basic credit to a parent, reduced by the student’s income. Plan this before you file, because the student must make the transfer on their own return.

Sell losing investments by December 30, 2026

Capital losses offset capital gains, and 50% of a net gain is taxable. To count for 2026, the sale must settle by December 31, 2026. With one-day settlement, your last trade date is Wednesday, December 30, 2026. Don’t buy the same or an identical security within 30 days before or after the sale (you, your spouse or a corporation you control), or the superficial loss rule denies the loss. Unused net capital losses can be carried back three years or forward indefinitely.

Claim the Québec credits that pay you even with little or no tax

• Solidarity tax credit: for the July 2026 to June 2027 payments, a basic amount of $363 per adult, $172 more for a person living alone, and a housing amount ($746 alone or single parent, $906 for a couple), reduced above $43,195 of family income. You must file a TP-1 to get it.
• Work premium: for low and moderate work income, up to $1,207.33 for a person living alone, $1,882.45 for a couple without children, $3,122.40 for a single-parent family and $4,057.00 for a couple with children in 2026.
• Home-support services for seniors: for people 70 or older, 40% of eligible expenses up to $19,500 ($25,500 if dependent), reduced above $72,465 of family income.
• Career extension credit: for workers 65 and older, on work income above $7,655, up to $12,755 of eligible income, reduced above $57,660 of net income (2026 parameters).
• Caregiver credit: up to $1,525 per component, up to $3,050 when you live with an adult relative who has a severe and prolonged impairment.

How to pay less tax as a couple in Québec

Canada taxes individuals, not couples, so the goal is to even out your two incomes and put each credit where it is worth most.

• Spousal RRSP: the higher earner contributes using their own room and gets the deduction; the money is later taxed in the lower earner’s hands. Withdrawals are taxed back to the contributor if they made a spousal contribution in the year of withdrawal or the two previous years, so plan withdrawals at least three calendar years out.
• Put each credit on the right return: medical expenses and childcare with the lower-income spouse federally, and all donations pooled on one return.
• Unused Québec credits: Québec lets you transfer the unused portion of your non-refundable credits to your spouse (line 431 of the TP-1).
• Pension income splitting: see the retirement section below.

How to pay less tax in retirement in Québec

• Split pension income: you can allocate up to 50% of eligible pension income to your spouse on both returns. Federally, RRIF and RRSP annuity income qualify from 65 (registered pension plan annuities at any age). In Québec, the transferring spouse must be 65 or older at year-end for any splitting.
• Watch the OAS recovery threshold: for 2026 it is $95,323 of net income. Splitting, RRIF timing and TFSA withdrawals (which are not income) can keep you under it.
• Keep your age-related credits: the 2026 federal age amount is $9,208, reduced above $46,432 of net income. In Québec, the age amount ($3,986), the retirement income amount ($3,541) and the person living alone amount ($2,172) are reduced above $42,955 of family income.
• Claim home-support services once you turn 70, and the career extension credit if you still work at 65 or older.
• Share your QPP or CPP pension with your spouse on request, which can even out your incomes in future years.

How to pay less tax when you’re single in Québec

Without a spouse to split with, timing and deductions do the work.

• Claim the Québec amount for a person living alone ($2,172 for 2026) and the extra solidarity credit amount for living alone.
• Put your first $8,000 in an FHSA if you qualify, then use your RRSP if your income is above about $58,500 (where the combined rate reaches 36.12%).
• Bunch donations or elective medical work into one year if you are close to the thresholds.
• If your income is low, file anyway: the solidarity credit and the work premium are paid only if you file a TP-1.

Worked example: a couple’s year-end moves in 2026

Alex earns a $120,000 salary and Sam earns $45,000. Both live in Québec, they have $3,000 of family dental and medical bills and give $1,500 to charity. Sam is saving for a first home.

One more point: in Québec, their medical threshold is 3% of family income (about $4,410 after Alex’s RRSP and Sam’s FHSA deductions), so the $3,000 gives no Québec credit this year. If more dental work is planned for early 2027, a 12-month period ending in 2027 that captures both years’ bills may clear the Québec threshold. Figures are estimates using 2026 rates and ignore other credits.

Part B: Year-end tax planning for business owners and the self-employed

Should you buy equipment before year-end?

Only if you need it. Equipment is deductible through capital cost allowance (CCA), and the deduction starts in the year the asset is available for use, not the year you pay. A machine ordered in December but installed in January counts for next year.

• Current rules: Bill C-15 (law since March 26, 2026) restored the full Accelerated Investment Incentive. Eligible property acquired after 2024 and available for use before 2030 generally gets three times the normal first-year CCA (the half-year rule is set aside and the first-year rate is increased by half), with a phase-down from 2030 to 2033. Example: $35,000 of equipment in a 20% class gives $10,500 in year one instead of $3,500.
• Proposed Mega Deduction: for most depreciable property acquired on or after September 15, 2026, Ottawa proposes a 100% deduction in the first year the property is available for use. Buildings, goodwill and franchises, and many passenger vehicles are excluded. Used property only qualifies if neither you nor a related person owned it before, and individuals and partnerships with individual members face limits on creating losses with it. The draft legislation was not law at the time of writing.
• Québec: on November 5, 2026, Québec’s Finance department said it had not decided whether to harmonize with the Mega Deduction, citing its cost. Québec’s CCA may differ until it does.

Bonus or dividend before December 31?

• Bonus: a bonus declared and recorded at year-end is deductible to the corporation for 2026 if it is paid within 180 days after the year-end, so by June 29, 2027 for a December 31 year-end. You are taxed when it is paid, and source deductions are remitted then.
• Dividends: not deductible to the corporation and taxed to you in the year paid. A dividend paid on December 31, 2026 is 2026 income; one paid January 2, 2027 is 2027 income.
• Which one? It depends on your corporation’s tax rate, your RRSP and QPP goals and parental leave plans. Our salary vs dividends guide runs the numbers.

Pay yourself enough salary for next year’s RRSP room

RRSP room is 18% of the previous year’s earned income, and dividends are not earned income. To get the full 2027 limit of $35,390, you need about $196,611 of salary (or self-employment profit) in 2026. A bonus paid through payroll by December 31, 2026 is often the cleanest way to get there. A bonus accrued for 2026 but paid in 2027 is still deductible to the corporation for 2026, but it is your 2027 income, so it builds 2028 room instead.

Clear shareholder loans in time

If your corporation paid personal expenses for you or lent you money, the balance generally has to be repaid within one year after the end of the corporation’s tax year in which the loan was made. For a December 31, 2026 year-end, that is December 31, 2027. If not, the loan is added to your 2026 income. Repaying just before the deadline and borrowing again right after is treated as a series and doesn’t work. A low-interest or interest-free loan also creates a taxable benefit at the prescribed rate.

Pay family members, but keep it reasonable

Salaries to a spouse or children are deductible if they do real work and the pay is reasonable for that work. Keep timesheets and run the pay through payroll with RL-1 and T4 slips. Dividends to family members are subject to the tax on split income unless an exclusion applies, for example a spouse who works about 20 hours a week in the business, or dividends to the spouse of an owner aged 65 or older.

Prepay expenses? Usually no tax benefit

Prepaying 2027 rent, insurance or subscriptions in December doesn’t generally create a 2026 deduction, because prepaid expenses are deducted in the period they cover. Paying a bill that relates to 2026 before year-end, or recording it as a payable, is what counts. Expenses incurred in 2026 are deductible even if you pay them in January, as long as they are recorded.

Close the books properly

• Count inventory on December 31 and write down obsolete or damaged stock.
• Write off bad debts: receivables you have tried and failed to collect can be deducted for 2026, and you may be able to recover the GST and QST you remitted on them.
• Reconcile GST and QST: make sure every input tax credit and refund on 2026 purchases is claimed, and check whether you crossed the small-supplier threshold. See our GST/QST guide.
• Prepare payroll slips: T4 and RL-1 slips for 2026 are due at the end of February 2027, which generally means Monday, March 1, 2027 because February 28 is a Sunday (see our T4 and RL-1 guides).

Instalments: pay the December 15 one

If your net tax owing is more than $1,800 in Québec (the federal threshold for Québec residents is also $1,800) in 2026 and in one of the two previous years, you are expected to pay instalments on March 15, June 15, September 15 and December 15. Missing them costs interest, so pay the December 15, 2026 instalment even if you plan to settle the rest in April. Corporations have their own instalment schedule, which we set when we prepare your T2 and CO-17.

Self-employed and not incorporated?

Your business year generally ends December 31. Before then, buy what you need and have it ready for use, log your vehicle kilometres, and keep home office records. You pay both halves of QPP on your profit, so an RRSP contribution is especially valuable. You file by June 15, 2027 but pay by April 30, 2027. Our self-employed tax guide and deadlines guide cover the details.

Worked example: an incorporated owner’s year-end moves

Nadia owns 100% of a Québec corporation with a December 31 year-end. She has received an $80,000 salary through payroll in 2026. The corporation paid $18,000 of her personal expenses during the year, recorded as a shareholder loan, and she plans to buy $35,000 of equipment.

Whether a large bonus beats dividends depends on her corporation’s tax rate and her goals, which is why we run both scenarios before December 31.

When should you talk to us?

Ideally in November, while there is still time to act. We prepare personal returns from $300, corporate returns from $1,200 a year and bookkeeping from $350 a month. Our team includes Canadian CPAs and US CPAs, and a tax professional reviews every return. See personal tax returns, tax preparation, bookkeeping or pricing, read our Québec personal tax return guide or should you incorporate?, or contact us for a year-end review. Rules change and every situation differs, so treat this checklist as a starting point, not advice for your specific case.

Frequently asked questions

Sources

• CRA — Indexation of personal income tax and benefit amounts (2026)
• CRA — RRSP, TFSA and YMPE limits
• CRA — How contributions affect your RRSP deduction limit
• CRA — Contributing to your FHSA
• CRA — Tax deductions for FHSA contributions
• CRA — Before you contribute to a TFSA
• CRA — Who has to pay instalments
• CRA — Accelerated Investment Incentive (original rules and how the enhanced allowance works; page predates Bill C-15)
• Finance Canada — Productivity Mega Deduction (September 15, 2026)
• Income Tax Act, s. 78(4) — unpaid remuneration (180 days)
• Finances Québec — Paramètres du régime d’imposition des particuliers 2026
• Québec.ca — Budget fédéral du 5 novembre 2026 : réaction du ministère des Finances (mégadéduction)
• Doane Grant Thornton — What Bill C-15 means for you (Accelerated Investment Incentive reinstated)
• EY — Reaccelerated investment incentive in Bill C-15
• CRA — IT-109R2 Unpaid amounts (payment on the 180th day)
• Revenu Québec — Line 381, medical expenses
• Revenu Québec — Line 395, tax credits for donations and gifts
• Revenu Québec — Line 398.1, tuition credit transferred by a child
• Revenu Québec — Line 245, retirement income transferred to your spouse
• Revenu Québec — Childcare expenses that qualify
• Revenu Québec — Tax credit for career extension
• Revenu Québec — Making instalment payments
• Raymond Chabot Grant Thornton — Impôt des particuliers, Québec 2026
• Raymond Chabot Grant Thornton — Nouveautés 2026 pour l’individu et la famille
• Raymond Chabot Grant Thornton — Pension income splitting
• Raymond Chabot Grant Thornton — Tuition tax credit and transfers
• KPMG — Québec refundable tax credit rates and amounts for 2026
• KPMG — Faits saillants du budget du Québec 2026
• PwC — Permanent immediate expensing (Mega Deduction) details
• TaxTips.ca — 2026 donation tax credit rates
• TaxTips.ca — Child care expense limits
• Raymond James — Tax-loss harvesting in 2026

Keep reading

• Salary or dividends in Québec (2026): how to pay yourself
• Should you incorporate your business in Québec? (2026 guide)
• Self-Employed Tax in Québec (2026): Rates, Deadlines, T2125, TP-80
• GST/QST for Québec Small Businesses (2026): How It Works
• Relevé 1 (RL-1) explained box by box (2026)
• T4 slip explained box by box (2026)