Payroll in Quebec — QPP, QPIP, HSF, and CNESST

Introduction
Understanding payroll in Quebec QPP QPIP HSF and CNESST is essential for any employer operating in Québec. Québec has the most complex payroll system in Canada, with separate provincial deductions, remittance requirements and reporting standards, all administered by Revenu Québec rather than the CRA. Employers must calculate and remit QPP, QPIP, HSF and CNESST in addition to federal source deductions. Errors in Québec payroll cause penalties, audits, reassessments and serious consequences for business owners. This guide explains everything employers need to know about payroll in Quebec QPP QPIP HSF and CNESST, ensuring compliance across all provincial obligations.

Legal and Regulatory Framework
Payroll in Quebec QPP QPIP HSF and CNESST is governed by:

• Québec Taxation Act
• QPP — Québec Pension Plan legislation
• QPIP — Québec Parental Insurance Plan
• CNESST — Québec Occupational Health and Safety Act
• HSF — Health Services Fund regulations
• Employment Standards Act (Québec)
• Income Tax Act (Federal)

Employers must withhold:
• Québec provincial income tax
• QPP contributions
• QPIP premiums
• EI (for non-Québec employees)
• CPP (for non-Québec employees)
• federal income tax
And must remit employer contributions to QPP, QPIP, HSF and CNESST.

Payroll in Quebec QPP QPIP HSF and CNESST is separate from CRA payroll remittances and must be filed correctly with Revenu Québec.

1. Québec Pension Plan (QPP)

QPP replaces CPP for Québec-based employees.
Key requirements:

• employees working in Québec contribute to QPP, not CPP
• employer matches the employee’s QPP contribution
• annual maximums apply
• QPP applies to salary, wages, bonuses and taxable benefits
• QPP contributions must be reconciled on RL-1 slips

QPP is one of the core payroll in Quebec QPP QPIP HSF and CNESST obligations and is frequently audited.

2. Québec Parental Insurance Plan (QPIP)

QPIP replaces EI maternity and parental benefits for Québec employees.

Employers must:
• withhold QPIP premiums from employee pay
• remit employer QPIP contributions
• file QPIP premiums on RL-1
• ensure EI is not deducted for Québec employees (common mistake)

QPIP is mandatory for all Québec-based employment income and is a key component of payroll in Quebec QPP QPIP HSF and CNESST.

3. Health Services Fund (HSF)

HSF is a mandatory employer-side payroll tax used to fund Québec’s healthcare system.

HSF rates depend on:
• total Québec payroll
• industry type
• business size

HSF applies to:
• wages
• bonuses
• vacation pay
• taxable benefits

HSF does not apply to contractors — unless misclassified.

Incorrect HSF calculations are among the most common payroll in Quebec QPP QPIP HSF and CNESST errors.

4. CNESST (Workers’ Compensation Insurance)

CNESST is Québec’s workplace safety, injury prevention and compensation program.

Employers must:
• register with CNESST
• pay annual insurance premiums
• classify their business under the correct CNESST risk category
• report payroll annually
• comply with workplace safety regulations
• cover wages during certain injury periods

CNESST premiums vary heavily by industry risk.
Improper classification triggers reassessments and penalties.

Key Court Decisions

Courts regularly issue rulings involving payroll in Quebec QPP QPIP HSF and CNESST:

• employers are fully liable for missing payroll deductions regardless of intent
• directors may be personally liable for unpaid QPP/QPIP remittances
• misclassified employees (as contractors) trigger retroactive payroll assessments
• taxable benefits (vehicle, housing, allowances) must be included in QPP/QPIP/HSF
• CNESST reclassifications frequently result in higher premiums
• ignorance of Québec payroll regulations is not a defense

Québec courts enforce payroll compliance more aggressively than anywhere else in Canada.

Why Revenu Québec Targets These Issues

Payroll in Quebec QPP QPIP HSF and CNESST is heavily monitored because:

• provincial payroll contributions fund major government programs
• Québec has strict enforcement culture
• misclassification is common
• taxable benefits are often unreported
• payroll tax errors are frequent in small businesses
• dual systems (federal and Québec) confuse employers

Audit triggers include:

• T4 totals not matching RL-1 totals
• QPP incorrectly deducted instead of CPP
• EI incorrectly deducted instead of QPIP
• missing HSF contributions
• underreported CNESST payroll
• late remittances
• taxable benefits missing on RL-1

Revenu Québec aggressively audits payroll compliance.

Mackisen Strategy

Mackisen CPA provides a complete compliance solution for payroll in Quebec QPP QPIP HSF and CNESST:

• registering all required payroll accounts
• setting up accurate payroll software configurations
• ensuring correct QPP vs CPP and QPIP vs EI deductions
• calculating HSF and CNESST accurately
• preparing RL-1 and T4 slips
• reconciling federal and Québec payroll filings
• correcting past payroll errors through voluntary disclosure
• handling Revenu Québec and CNESST audit communications
• preparing year-end summaries
• ensuring full compliance with taxable benefit rules

Mackisen ensures payroll is accurate, compliant and audit-proof.

Real Client Experience

Many Québec employers come to Mackisen after payroll errors:

• A Montréal clinic deducted EI for Québec employees instead of QPIP. Revenu Québec issued large assessments. Mackisen corrected filings and negotiated reductions.
• A construction firm misreported CNESST payroll and was reclassified at a higher risk category. We recalculated premiums and appealed the decision.
• An employer failed to calculate HSF for two years. Mackisen reconstructed payroll and filed all missing remittances.
• A tech company misclassified employees as contractors. CRA and Revenu Québec reassessed payroll deductions. Mackisen restructured contracts and managed the audit.
• A business omitted car benefits from RL-1 slips, leading to QPP/QPIP under-reporting. We corrected benefits and filed amended slips.

These cases highlight how crucial proper payroll in Quebec QPP QPIP HSF and CNESST compliance is.

Common Questions

• Do Québec employees contribute to CPP or EI?
No — QPP and QPIP replace them.

• Do I need both Revenu Québec and CRA payroll accounts?
Yes — both are required for Québec employers.

• Is HSF required even if I have only one employee?
Yes — HSF applies to all Québec payrolls.

• Do contractors fall under QPP/QPIP?
No — unless they are misclassified, which triggers payroll reassessment.

• Do taxable benefits count for QPP/QPIP?
Yes — and for HSF as well.

These clarify payroll in Quebec QPP QPIP HSF and CNESST obligations.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps businesses stay compliant while recovering the taxes they’re entitled to. Whether you're setting up payroll for the first time or correcting complex Québec payroll errors, our expert team ensures precision, transparency and protection from audit risk. When managing payroll in Quebec QPP QPIP HSF and CNESST, Mackisen provides full registration, calculation, reconciliation and audit-defense services.