Quebec Economic Statement contains important information on Premium Tax Increase – Impact to Sun Life Group Benefits

#492

PDF Version

The Quebec economic statement – Update on Quebec's Economic and Financial Situation – was released on December 2, 2014, and included tax measures that became effective on December 3, 2014. This means the Quebec premium tax rate is now 3.48% versus the previous rate of 2.30%.

What does this mean to you?

Below is an overview of the impact to Insurance and Administrative Services Only (ASO) arrangements, when there is Quebec content:   

  • If your renewal rates are effective in February, March, April or May 2015, then the renewal rates will include the increased premium tax rate plus an adjustment load to reflect the tax impact between the effective date of the tax increase and the renewal rate effective date. If your renewal was already released, it will be reissued in December 2014.
  • If your renewal rates  are effective in any other month, your premium rates will be modified effective March 1, 2015.  The rate change will include the increased premium tax plus  an adjustment load to reflect the premium tax impact between the effective date of the tax increase and the renewal rate effective date. You will receive your revised rates in January 2015.  Financial Statements prepared for Refund Accounting arrangements will include a pro-rated tax rate to reflect the tax rate in force before and after the effective date of the tax rate change.
  • For ASO arrangements, the new tax rate will be used effective with the December 2014 ASO statements and invoices that are released in January 2015. 

Questions?

Please contact your Client Service Administrator at 1-877-786-7227.