Doing Business in Québec

Corporate Registration and Filing Requirements Businesses operating in Québec are required to file and update certain information in a public register with a governmental authority called the Registrar of Enterprises. Corporations constituted under the laws of a jurisdiction other than Québec are required to register within 60 days of the date on which they begin to carry on an activity in Québec, including the operation of a business. The concept of carrying on an activity or operating a business includes having an address, a post office box or a telephone line in Québec or performing any act for profit in Québec. The declaration of registration must contain, among other things, the registrant’s name, its directors’ and shareholders’ names and any other name it uses in Québec to carry on its business. A registrant is prohibited from using a name in Québec that does not comply with the Charter of the French language (which requirements are described below). All registrants must name their ultimate beneficiaries and provide the date of birth for each individual whose names appear on the Registrar. The information relating to date of birth and address is not accessible to the public. Together with filing the declaration of registration, directors of legal persons must file a copy of an identification document issued by a government authority, such as a passport or driver’s licence. The copies of the identification documents are destroyed by the Registrar in accordance with the Québec law once they are processed.

Taxes

INCOME TAXES In Québec, non-resident persons, other than partnerships (which are generally treated as

passthrough entities for Canadian and Québec tax purposes), are generally only subject to federal and provincial income taxes on limited sources of income — namely, employment income earned in Québec, business income attributable to an “establishment” situated in Québec, and the sale of Québec real estate or assets (such as shares) that principally derive their value from Québec real estate. In contrast, Canadian resident persons (including Canadian subsidiaries) are generally taxed on their worldwide income. Corporations generally benefit from preferential tax rates, but there are some exceptions. Various tax incentives are available, such as refundable and non-refundable tax credits with respect to scientific research and experimental development and certain renewable energies, as well as credits benefiting the financial sector (among other sectors and activities), as well as tax holidays for corporations that commercialize intellectual property or carry out a qualified large investment project, subject to certain conditions. GOODS AND SERVICES TAXES Goods and services provided in Québec are generally subject to the Canadian federal goods and services tax (GST) and the Québec sales tax (QST), subject to certain exceptions. The combined GST/QST rate as of 2023 is 14.975%. Businesses required to charge and collect GST/QST must register with Revenu Québec and obtain GST and QST numbers. Businesses are often entitled to input tax credits and input tax refunds for any GST/QST paid on property or services used or consumed in the course of their commercial activities.