Quebec pilot project offers automatic tax filing for simple returns

The Quebec government introduced the initiative in its 2023 budget, tabled March 21, to ensure residents don’t miss out on provincial benefits that are generally available only to those who file a return. Quebecers file provincial and federal returns separately.

The project will “target a limited number of individuals” who have “simple tax profiles,” the budget stated. The province defined a simple profile as one where the tax authority receives from third parties all the taxpayer’s information — such as income and pension amounts — that is required to assess tax and determine benefits.

Quebec’s initiative was followed by a similar announcement in the 2023 federal budget. The feds proposed piloting a new, automatic filing service intended to help vulnerable Canadians receive benefits. A plan will be released in 2024, the budget said.

About three dozen countries, including Finland, Slovenia and Denmark, already incorporate some form of automatic or “return-free” filing.

Here are other notable proposals from 2023 provincial budgets you may have missed:

Ontario

The Ontario government said it would review the province’s tax system to prioritize “competitiveness and long-term growth” and the “fairness and effectiveness of tax relief and supports.” The government also said it would continue to simplify tax administration for Ontarians through digitization. The province did not provide timelines for the tax review or the technology upgrades.

CPA Canada has long called on the federal government to launch a comprehensive review of the Income Tax Act, calling it “bloated, complex and inefficient.” The most recent review of Canada’s tax regime, by the Carter Commission, was released in 1967.

Ontario also said it would expand its guaranteed annual income program for low-income seniors beginning in July 2024, resulting in about 100,000 more people being eligible, and index the support program to inflation.

British Columbia

The province proposed an income-tested tax credit of up to $400 per year to help residents with the cost of rent. The maximum amount will be available to renters with annual income up to $60,000, with the credit reduced for those earning between $60,000 and $80,000 and not available to those earning more. The thresholds will be indexed.

Finance Minister Katrine Conroy said the credit would apply to 80% of B.C. households beginning in the 2023 tax year. The program is estimated to cost around $300 million in each of the next three years.

To be eligible, taxpayers must be 19 or older, rent in B.C. for at least six months of the calendar year and pay rent to an unrelated person. The NDP government promised the rebate in the 2017 election campaign.

Newfoundland and Labrador

The province proposed doubling its refundable physical activity tax credit to $348 per family beginning with the 2023 tax year.

The province also plans to increase the value of its income supplement and senior’s benefit by 5%. The two benefits are refundable tax credits paid to low-income individuals, seniors and families in quarterly instalments. Eligibility for the credits is based on family net income from the previous year. Eligible residents receive the benefits automatically when they file a return.

Nova Scotia

The province proposed expanding eligibility for its skilled trades tax incentive to include nurses. The incentive, introduced in last year’s budget, offers a provincial tax rebate on the first $50,000 of income for eligible workers who are younger than 30.

Registered nurses, licensed practical nurses and nurse practitioners who work for publicly funded employers, continuing care and disability support programs, and publicly funded schools are eligible for the incentive. The expanded program would be effective as of the 2023 taxation year.