If you paid or received support-payment arrears or repayment of support (other than non-taxable support), or received retroactive payments and a part of these amounts are for previous tax years, you can request Revenu Québec to average these amounts by completing the TP-766.2-V.
By requesting an averaging of the amounts, Revenu Québec will determine if it’s to your advantage to have the amount that applies to previous years deducted from your taxable income and applied to its respective year instead. This can result in a tax adjustment that might reduce your income tax for the current year.
Note: You can only request an averaging of these payments if the portion of the amount that’s applicable to previous years is at least $300.
Keep in mind, Revenu Québec can’t average payments that are part of a compensation adjustment, income replacement indemnities, or compensation for the loss of your financial support. If you’re transferring a portion of your retroactive payment to your spouse, neither of you can have it averaged.
You can also use the TP-766.2-V to carry over parts of your non-capital losses or non-refundable tax credits to the year in which they apply.
Types of retroactive payments
You might have received retroactive payments of:
- Employment income, if your payments were received because of a judgment, arbitration award, or a settlement
- Benefits like universal childcare benefits, employment insurance, old age security, QPP, social or financial assistance
- Wage loss replacement benefits that you need to include in your income
- Interest on retroactive payments
- Disability pension or any other benefit paid to you under the Québec Pension Plan (QPP) or the Canada Pension Plan (CPP), or life annuity payments under a pension plan
- Labour adjustment and income assistance benefits
- An earnings loss benefit, supplementary retirement benefit, or a permanent impairment allowance paid under the Canadian Forces Members and Veterans Re-establishment and Compensation Act
- An amount other than your employment income that, according to the Minister of Revenue, would unduly increase your tax burden if it were included in your income that year
Where do I claim this?
Follow these steps in H&R Block’s 2018 tax software:
Before you begin, make sure you told us that you lived in Québec on December 31, 2018.
- Under the PREPARE tab, click the OTHER icon You’ll find yourself here:
- Under the OTHER SITUATIONS heading, select the checkbox labelled Averaging of support payments (TP-766.2-V), and then click Continue.
- When you arrive at the page for Averaging of support payments (TP-766.2-V), enter your information into the tax software.