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Detailed Calculation of the QST and Return Concerning a Taxable Immovable or Taxable Carbon Emission Units

About this content

This content is a simplified paraphrase of the official publication of Revenu Québec: VDZ-471.G(2019-10).pdf, produced to help citizens and businesses better understand their tax obligations. It does not constitute legal or tax advice. Refer to the official document for any decision.

Who this document is for​

This document is intended for any person registered with the Quebec sales tax file, the QST, who must file a QST return using form VDZ-471. It concerns in particular registrants who must:

  • calculate the QST to be reported for a given period;
  • calculate input tax refunds, called ITRs;
  • report tax adjustments, where applicable;
  • report instalments already paid;
  • report the tax related to the acquisition:
  • of a taxable immovable;
  • of taxable carbon emission units. The document is therefore primarily intended for businesses, self-employed workers, individuals in business, organizations, or other persons registered for QST who have reporting obligations related to form VDZ-471.CD.

Context and purpose​

The document accompanies the form Detailed Calculation of the QST and Return Concerning a Taxable Immovable or Taxable Carbon Emission Units (VDZ-471.CD).

This form is used to detail the calculations related to the Quebec sales tax for a reporting period. It is used in particular to determine the net tax, taking into account the QST payable, input tax refunds, applicable adjustments and instalments. It is also used to separately report the QST payable when a registrant acquires a taxable immovable or taxable carbon emission units for use or supply mainly in its commercial activities. The information provided in the document does not constitute an official legal interpretation of the Act respecting the Quebec sales tax or its regulations. The text of the law remains the reference where needed.

Complete and detailed information​

General information on form VDZ-471.CD​

Form VDZ-471.CD is linked to QST return VDZ-471. It is used by persons registered in the QST file who must file this return. It allows several tax operations to be carried out for a reporting period:

  • calculate QST;
  • calculate ITRs;
  • report tax adjustments, if any;
  • report instalments paid;
  • report, in part 2, the tax applicable to the acquisition:
  • of a taxable immovable;
  • of taxable carbon emission units.

Penalties, interest and offences​

Penalties may apply under the Tax Administration Act when a person does not comply with their tax obligations.

Failure to file a return​

If a return is not filed in the prescribed manner and within the time limit provided for by a tax statute, a late-filing penalty may be imposed. This penalty is:

  • $25 per day for the entire duration of the default;

  • up to a maximum of $2,500.

Failure to collect an amount​

When a person fails to collect an amount they were required to collect, a penalty may be imposed. This penalty is equal to:

  • 15% of the amount not collected.

Failure to pay or remit an amount within the prescribed time​

When an amount is not paid or remitted within the prescribed time, a penalty applies according to the length of the delay. The rates are as follows:

Late periodPenalty rate
From the 1st to the 7th day late7% of the amount
From the 8th to the 14th day late11% of the amount
Starting on the 15th day late15% of the amount

Interest​

Any amount that remains unpaid on the due date bears interest. The applicable rate is the rate set by regulation.

False declaration​

Filing a false return constitutes an offence. The offending person may then be subject to criminal prosecution.

Record keeping and retention​

A person who operates a business, or who must withhold or collect an amount under a tax statute, has record-keeping obligations. They must:

  • keep records;
  • keep accounting books;
  • prepare an annual inventory.

The documents to be kept include:

  • records;
  • accounting books;
  • all supporting documents substantiating the information contained in them. These documents must be kept for six years after the last year to which they relate.

Electronic or computerized records​

When records are kept on an electronic or computerized medium, they must be kept:

  • on that same medium;
  • in an intelligible manner;
  • for the same period of six years. The person must also take the necessary measures to ensure and maintain the integrity of these documents throughout their life cycle. Failure to comply with these obligations constitutes an offence that may result in criminal prosecution.

Signature of the return​

Every return must be signed by:

  • the registrant themselves; or
  • a person authorized to represent them.

Confidentiality of information​

The personal information provided in form VDZ-471.CD is protected by the Tax Administration Act.

Part 1 — Detailed calculation of the QST for the reporting period​

Part 1 of form VDZ-471.CD is used to establish the detailed calculation of QST and ITRs for a reporting period. It also allows:

  • tax adjustments, if any, to be entered;
  • instalments that have been paid to be reported.

Line 201 — Total supplies of property and services​

On line 201, enter the total supplies of property and services made during the period. This total must be entered without including:

  • GST/HST;
  • QST. As a general rule, the amount entered must correspond to the sales revenue entered in the accounting records.

Case of the quick method of accounting​

If the registrant uses the quick method of accounting, the amount entered on line 201 must include QST.

Line 203 — Tax payable​

Line 203 is used to enter the tax payable. Tax payable corresponds to the total QST that, for the reporting period:

  • was collected;
  • is due to the registrant;
  • is deemed to have been collected. The following must also be included on this line:
  • QST payable on taxable property and services brought into Quebec when the registrant must remit that QST;
  • amounts collected by mistake as QST;
  • QST calculated on the self-supply of a residential complex.

Amounts not to be included on line 203​

QST to be remitted in connection with the acquisition of:

  • a taxable immovable;
  • taxable emission units;

must not be entered on line 203. It must instead be reported separately on line 214.

Line 204 — Amounts to add to tax payable​

On line 204, enter the total of the amounts that must be added to tax payable to calculate the net tax for the reporting period. These amounts may include, in particular:

  • QST related to the recovery of a bad debt that had been written off;
  • QST for which a refund had already been claimed in respect of goods returned to suppliers.

Line 206 — Input tax refunds​

Line 206 is used to enter the total ITRs related to the reporting period concerned. ITRs not claimed in a previous period may also be included where they relate to eligible purchases and expenses used to make:

  • taxable supplies;
  • zero-rated supplies. The registrant may also enter on line 206 the amount of QST giving entitlement to an ITR for the acquisition of:
  • a taxable immovable;
  • taxable emission units. This amount corresponds to the amount on line 214, where it gives entitlement to an ITR.

Amounts excluded from line 206​

The total entered on line 206 must not include:

  • tax paid on purchases and expenses used to make exempt supplies;
  • QST paid on motor vehicles purchased for the purpose of resale.

Restrictions applicable to large businesses​

Since January 1, 2018, large businesses may claim an ITR for property

and services that were subject to ITR restrictions according to progressive rates. The applicable rates are as follows:

YearITR rate that may be claimed
201825%
201950%
202075%
2021 and subsequent years100%
A note specifies that a registrant is generally considered a large business, for a given fiscal
year, when the total of its taxable sales and those of its associates for the previous fiscal year
exceeds $10 million.

General time limit to claim an ITR​

The usual time limit to claim an ITR is four years.

Line 207 — Amounts to add to ITRs​

Line 207 allows the total of amounts that may be added to the ITRs claimed on line 206 to be entered. These amounts may include, in particular:

  • the QST included in a bad debt that was written off;
  • QST collected on goods returned by customers and already remitted;
  • the QST credit granted by a builder to an individual purchaser of a new home, where this credit is granted as a QST rebate.

QST credit granted by the builder for a new home​

When a builder grants an individual purchaser a QST credit as a QST rebate for a new home, the builder must attach the purchaser’s rebate application to their return. The form to attach is:

  • Tax rebate granted by the builder for a new home (FP-2190.C).

Time limit for making an adjustment​

The time limit for making an adjustment is two years.

Amounts excluded from line 207​

The amount entered on line 207 must not include QST paid on motor vehicles purchased for resale. If QST was paid in this context, it must be recovered from the supplier.

Prohibition against claiming the amounts on line 207 twice​

The amounts entered on line 207 cannot be claimed again elsewhere. However, the data relating to those amounts must be kept.

Quick method of accounting and 1% credit​

If the registrant has filed form Choice or Revocation of the Choice of the Quick Method of Accounting (FP-2074) and has received written confirmation of their choice, they may claim a 1% credit. This credit applies:

  • to the first $31,421;
  • of eligible taxable supplies;
  • QST included;
  • for each fiscal year. However, the registrant using this method cannot claim an ITR for their operating expenses.

Pension plan and management entity​

Where a management entity and the eligible employers of a pension plan jointly elect to transfer all or part of the pension rebate of the management entity to one or more eligible employers, each eligible employer may claim an adjustment in their tax return. This adjustment relates to the eligible employer’s determined share. To calculate the amount of the adjustment, each eligible employer must complete, depending on their situation:

  • part 5 of form GST/HST and QST Rebate Application and Election for a Management Entity (FP-4607); or
  • part 6 of the same form.

Line 210 — QST instalments​

Line 210 applies to annual returns. If the registrant files an annual return and has paid QST instalments, they must enter those instalments on line 210.

Line 211 — Rebates used to reduce an amount owing​

Line 211 allows an amount from an already completed rebate application form to be entered when that form indicates a rebate that can be used to reduce an amount owing. The forms referred to are as follows:

FormTitle
FP-2066GST/HST and QST rebate application for public service bodies
VD-403General application for a Quebec sales tax rebate
VD-370.67 and VD-370.89QST rebate for a new rental housing unit
VD-403.EApplication for rebate concerning new motor vehicles shipped outside Quebec
FP-4607GST/HST and QST Rebate Application and Election for a Management Entity
When an amount is entered on line 211, the already completed rebate application form must
be attached to the return.
If the return must be filed electronically, the rebate application form must be sent separately by
mail. However, certain forms mentioned may be transmitted using an electronic tax rebate
application transmission service.

Limit on the use of line 211​

An amount may be entered on line 211 only to reduce a positive amount entered on line 209.

Line 213 — Carrying forward the result of Part 1​

The amount on line 213 must be carried to the corresponding box in the detachable section of form VDZ-471. Next, add the amounts entered in the boxes in that detachable section, taking into account the signs:

  • plus (+);
  • minus (–). If the result obtained is positive, it must be entered in the “Amount owing” box of the detachable section of the form. If the result obtained is negative, it must be entered in the “Rebate claimed” box.

Part 2 — Return concerning a taxable immovable or taxable carbon emission units​

Part 2 of the form is used to report the taxes related to the acquisition of:

  • a taxable immovable;
  • taxable emission units. This return is required when these property items were acquired to be used or supplied mainly in the course of the registrant’s commercial activities. In this context, “mainly” means more than 50%.

Definition of an emission unit​

An emission unit may be a right, a credit or a similar instrument that meets certain criteria.

First criterion — Issued or created by an eligible body​

The unit must be issued or created by, or on behalf of, one of the following persons or entities:

  • a government;

  • the government of a foreign country;

  • the government of a political subdivision of a country;

  • a supranational organization;

  • an international organization;

  • a board established by such a body;

  • a commission established by such a body;

  • another entity established by such a body;

  • an agency of such a body. These entities are grouped under the expression regulatory body.

Second criterion — Use in an emissions regulatory mechanism or agreement​

The unit must be able to be used to satisfy a requirement provided for in a mechanism or agreement. This mechanism or agreement must meet one of the following conditions:

  • be implemented by or on behalf of a regulatory body in order to regulate greenhouse gas emissions;
  • be prescribed by regulation.

Third criterion — Representation of a specified quantity of greenhouse gases​

The unit must represent a specified quantity of greenhouse gases expressed in carbon dioxide equivalent. The example given is:

  • one metric ton of carbon dioxide equivalent.

Instrument not representing a specified quantity of greenhouse gases​

A right, credit or similar instrument that does not represent a specified quantity of greenhouse gases does not meet the third criterion. This remains true even if the instrument otherwise meets the requirements of a greenhouse gas emissions regulatory mechanism. The example given is that of an instrument required to undertake certain manufacturing activities that produce greenhouse gas emissions. If this instrument does not represent a specified quantity of greenhouse gases, it does not satisfy the third criterion.

Property prescribed by regulation​

An emission unit may also be property prescribed by regulation. However, at the time the document was published, no property was prescribed by regulation.

Filing and payment dates​

General filing deadline​

The return including parts 2 and 3 of form VDZ-471.CD must be filed no later than one month after the last day of the reporting period.

Annual return​

Where it is an annual return, the return must be filed no later than three months after the end of the business’s fiscal year.

Individual in business with annual period ending on December 31​

For an individual in business whose filing frequency is annual and whose reporting period ends on December 31, the filing deadline is June 15 of the following year. However, if that individual must pay a QST balance, the payment deadline is April 30.

Deadline falling on a Saturday, Sunday or holiday​

If the filing deadline falls on:

  • a Saturday;
  • a Sunday;
  • a holiday; the return and payment are considered received on time if they are received on the next business day.

Date the return is received​

The date the return is considered received depends on the method of transmission. If the return is handed in person, the date used is the date on which it is stamped by Revenu Québec. If the return is mailed, the date used is the postmark date.

Date payment is received​

The date considered to be the date payment is received depends on the method of payment.

Payment made at a financial institution​

When payment is made at a financial institution, the date received corresponds to the date of payment. This applies to payments made:

  • at the counter of the financial institution;
  • by means of the online payment service offered by the financial institution;
  • at an automated teller machine.

Return sent by mail with a cheque or money order​

If the return is mailed with a cheque or money order, the date payment is received corresponds to the date on which the return is stamped by Revenu Québec.

Postdated cheque​

When a payment is made by postdated cheque, the date payment is received is the date on which the cheque may be cashed.

Cheque or money order sent separately from the return​

If the cheque or money order is not sent with the return, the date payment is received is the date on which the cheque or money order is stamped by Revenu Québec.

Instructions for Part 2​

Line 213 — Amount from Part 1​

If applicable, enter on line 213 the amount from line 213 of Part 1.

Line 214 — QST on a taxable immovable or taxable emission units​

On line 214, determine the value:

  • of the taxable immovable;
  • or of the taxable emission units; acquired to be used or supplied mainly in the course of commercial activities. The QST to be reported and remitted is calculated by multiplying:
  • the value of the immovable or emission units;
  • by the QST rate in effect at the time of purchase. The result must be entered on line 214.

Line 216 — Addition of lines 213 and 214​

On line 216, enter the result obtained by adding lines 213 and 214, taking into account the signs:

  • plus (+);
  • minus (–). The amount on line 216 must then be carried to box 213 of the detachable section of form VDZ-471. After this carryover, add the amounts entered in the boxes of the detachable section of the form, taking into account the signs:
  • plus (+);
  • minus (–). If the result is positive, it must be entered in the “Amount owing” box of the detachable section. If the result is negative, it must be entered in the “Rebate claimed” box.

Special cases and exceptions​

Quick method of accounting​

When a registrant uses the quick method of accounting:

  • the amount on line 201 must include QST;
  • they may claim the 1% credit on the first $31,421 of eligible taxable supplies, QST included, for each fiscal year, only if they filed form FP-2074 and received written confirmation;
  • they cannot claim an ITR for their operating expenses.

Acquisition of a taxable immovable or taxable emission units​

QST related to the acquisition of a taxable immovable or taxable emission units must not be included on line 203.

It must be reported separately on line 214. Where this QST gives entitlement to an ITR, it may also be included on line 206.

Exempt supplies​

Tax paid on purchases and expenses used to make exempt supplies must not be included in the ITRs on line 206.

Motor vehicles intended for resale​

QST paid on motor vehicles purchased for resale must not be included:

  • on line 206;
  • on line 207. If this QST was paid in this context, it must be recovered from the supplier.

Large businesses​

Large businesses are subject to special rules concerning progressive ITR restrictions. A registrant is generally a large business for a given fiscal year when the total of its taxable sales and those of its associates for the previous fiscal year exceeds $10 million. Since January 1, 2018, the ITR rates allowed for property and services subject to large-business restrictions are:

  • 25% for 2018;
  • 50% for 2019;
  • 75% for 2020;
  • 100% for 2021 and subsequent years.

QST rebate granted by a builder​

When a builder grants an individual purchaser of a new home a QST credit as a rebate, the purchaser’s form FP-2190.C must accompany the return.

Pension plans and management entities​

Where a management entity and the eligible employers of a pension plan jointly elect to transfer all or part of a pension rebate, each eligible employer may claim an adjustment according to their determined share. The calculation must be done using part 5 or 6, as the case may be, of form FP-4607.

Line 211 limited to reducing a positive amount​

An amount may be entered on line 211 only to reduce a positive amount entered on line 209.

Individual in business with annual return ending on December 31​

An individual in business whose filing frequency is annual and whose period ends on December 31 has a specific deadline:

  • filing the return: June 15 of the following year;
  • payment of the QST balance, if any: April 30.

Deadline on a non-business day​

When a deadline falls on a Saturday, Sunday or holiday, the return and payment are deemed to be received on time if they are received on the next business day.

Emission unit not representing a precise quantity of greenhouse gases​

An instrument related to greenhouse gas regulation does not constitute an eligible emission unit if it does not represent a specified quantity of greenhouse gases, even if it otherwise meets the requirements of a regulatory mechanism.

Property prescribed by regulation​

An emission unit may be property prescribed by regulation, but no property was so prescribed at the time the document was published.

Procedures and steps​

Filing Part 1 of form VDZ-471.CD​

To complete Part 1, the registrant must proceed as follows:

  1. Enter on line 201 the total supplies of property and services made, generally without GST/HST or QST.
  2. Include QST on line 201 only if the quick method of accounting is used.
  3. Enter on line 203 the total QST collected, due or deemed collected for the period.
  4. Add to line 203:
  • QST payable on taxable property and services brought into Quebec;
  • amounts collected by mistake as QST;
  • QST relating to the self-supply of a residential complex.
  1. Do not enter on line 203 the QST on the acquisition of a taxable immovable or taxable emission units; instead use line 214.
  2. Enter on line 204 the amounts to add to tax payable, such as certain recoveries or rebates already claimed.
  3. Enter on line 206 the eligible ITRs for the period as well as eligible ITRs not claimed in a previous period.
  4. Include on line 206, if applicable, the QST giving entitlement to an ITR in respect of the acquisition of a taxable immovable or taxable emission units.
  5. Exclude from line 206:
  • tax related to exempt supplies;
  • QST on motor vehicles purchased for resale.
  1. Enter on line 207 the amounts that may be added to ITRs, such as certain bad debts, certain returned goods or the QST credit granted by a builder.
  2. Attach form FP-2190.C if a builder claims the QST credit granted to an individual purchaser of a new home.
  3. If the quick method of accounting applies, claim the 1% credit on the first $31,421 of eligible taxable supplies, QST included, only if the choice was confirmed in writing after filing form FP-2074.
  4. If an adjustment related to a management entity and a pension plan is claimed, complete part 5 or 6 of form FP-4607, as applicable.
  5. Enter on line 210 the QST instalments paid, if the return is annual.
  6. Enter on line 211 an eligible rebate from an already completed form, only to reduce a positive amount on line 209.
  7. Attach the corresponding rebate application form if an amount is entered on line 211, or send it separately if the return is filed electronically.
  8. Carry the amount from line 213 to the corresponding box in the detachable section of form VDZ-471.
  9. Add the boxes in the detachable section taking into account the signs + and –.
  10. Enter the result in “Amount owing” if it is positive.
  11. Enter the result in “Rebate claimed” if it is negative.

Filing Part 2 of form VDZ-471.CD​

To complete Part 2, the registrant must follow these steps:

  1. Check whether a taxable immovable or taxable emission units were acquired.
  2. Check whether these property items were acquired to be used or supplied mainly, that is, more than 50%, in commercial activities.
  3. Enter on line 213, if applicable, the amount from line 213 of Part 1.
  4. Determine the value of the taxable immovable or taxable emission units.
  5. Multiply this value by the QST rate in effect at the time of purchase.
  6. Enter the result on line 214.
  7. Add lines 213 and 214 taking into account the signs + and –.
  8. Enter the result on line 216.
  9. Carry the amount from line 216 to box 213 of the detachable section of form VDZ-471.
  10. Add the boxes in the detachable section taking into account the signs + and –.
  11. Enter the result in “Amount owing” if it is positive.
  12. Enter the result in “Rebate claimed” if it is negative.

Forms mentioned​

The forms mentioned in the document are as follows:

NumberForm name
VDZ-471QST Return
VDZ-471.CDDetailed Calculation of the QST and Return Concerning a Taxable Immovable or
Taxable Carbon Emission Units
FP-2190.CTax rebate granted by the builder for a new home
FP-2074Choice or Revocation of the Choice of the Quick Method of Accounting
FP-4607GST/HST and QST Rebate Application and Election for a Management Entity
FP-2066GST/HST and QST rebate application for public service bodies
VD-403General application for a Quebec sales tax rebate
VD-370.67QST rebate for a new rental housing unit
VD-370.89QST rebate for a new rental housing unit
VD-403.EApplication for rebate concerning new motor vehicles shipped outside Quebec

Deadlines to observe​

SituationTime limit or deadline
Claim an ITRGenerally 4 years
Make an adjustment2 years
File a return other than an annual return for parts 2 and 3 of VDZ-471.CDNo later than 1 month after the last day of the reporting period
File an annual returnNo later than 3 months after the end of the business’s fiscal year
Individual in business, annual return, period ended on December 31File no later than June 15 of the following year
Same individual if a QST balance must be paidPayment no later than April 30
Deadline on a Saturday, Sunday or holidayReceipt accepted on the next business day

Important warnings​

  • The information in the document does not replace the Act respecting the Quebec sales tax or its regulations.
  • Failure to file a return in accordance with the rules and within the deadlines may result in a penalty of $25 per day, up to $2,500.
  • Failure to collect an amount results in a penalty of 15% of that amount.
  • Failure to pay or remit an amount on time results in a penalty of:
  • 7% from the 1st to the 7th day late;
  • 11% from the 8th to the 14th day late;
  • 15% starting on the 15th day.
  • Amounts unpaid when due bear interest at the rate set by regulation.
  • A false declaration constitutes an offence that may lead to criminal prosecution.
  • Failure to keep and retain the required records, accounting books, inventories and supporting documents also constitutes an offence that may lead to criminal prosecution.
  • Records and supporting documents must be kept for six years after the last year concerned.
  • Electronic or computerized records must remain intelligible on the same medium for the same period.
  • The integrity of electronic or computerized records must be ensured and maintained throughout their life cycle.
  • Every return must be signed by the registrant or their authorized representative.
  • The personal information provided on the form is protected by the Tax Administration Act.
  • Amounts entered on line 207 may not be the subject of another claim.
  • Data relating to amounts entered on line 207 must be kept.
  • QST on motor vehicles purchased for resale must not be included on lines 206 or 207; it must be recovered from the supplier.
  • An amount may be entered on line 211 only to reduce a positive amount on line 209.
  • A postdated cheque is considered received only on the date on which it can be cashed.
  • QST on the acquisition of a taxable immovable or taxable emission units must be reported on line 214, not on line 203.
  • For emission units, an instrument must represent a specified quantity of greenhouse gases to meet the criterion provided for; otherwise, it does not meet the definition even if it is related to an emissions regulatory mechanism.

Summary​

Form VDZ-471.CD is used by QST registrants who must detail their calculation of QST, their ITRs, their adjustments, their instalments and, where necessary, the tax related to the acquisition of a taxable immovable or taxable emission units. Part 1 allows the net tax for the period to be calculated, while Part 2 concerns acquisitions used or supplied mainly, that is, by more than 50%, in commercial activities. ITRs are generally claimable within a period of four years, while certain adjustments must be made within a period of two years. Large businesses, generally those whose taxable sales with those of their associates exceed $10 million, are subject to progressive ITR rates for certain property and services: 25% in 2018, 50% in 2019, 75% in 2020 and 100% as of 2021. Returns must be filed within the prescribed time limits, including one month after the reporting period or three months after the end of the fiscal year for an annual return, with special rules for certain individuals in business. Significant penalties apply in the event of late filing, failure to collect, late payment or false declaration. Records and supporting documents must be kept for six years, including electronic records, which must remain intelligible and intact. Amounts must be correctly carried to the detachable section of form VDZ-471, in order to determine whether there is an amount owing or a rebate claimed.