If you are planning to have children soon, or would like to expand your current small family, the government of Québec has great news for you! To add more flexibility to the Québec Parental Insurance Plan (QPIP) and to promote family-work balance, several changes have been made. Some of these changes improve existing measures and others introduce entirely new elements.
Here are the highlights.
New benefits for adoptive parents
The provisions of the old plan only granted adoptive parents 37 weeks of shareable benefits in the basic plan, and 28 weeks in the special plan. From now on, adoptive parents will be entitled to three types of benefits, similar to those granted to biological parents:
Basic plan: five weeks of benefits at 70% of insurable earnings for each parent.
Special plan: three weeks at 75% of insurable earnings for each parent.
They are shareable between the two parents and are designed to meet the more specific needs of adoptions. They can begin during the week of the child’s arrival and, in the case of an adoption outside Québec, up to five weeks before the child’s arrival.
Basic plan: 13 weeks at 70% of insurable earnings.
Special plan: 12 weeks at 75% of insurable earnings.
They are similar to the parental benefits available to biological parents.
Basic plan: 32 weeks of shareable benefits – the first seven weeks are at 70% of insurable earnings and the remaining 25 weeks at 55% of insurable earnings.
Special plan: 25 weeks of shareable benefits at 75% of insurable earnings.
Increase in exemptions with respect to work income earned during benefits
During your QPIP benefits period, you can accumulate work income without reducing the amount of your benefits. This exemption was allowed under the old plan, but it was calculated on the amount of benefits, not on insurable earnings. Since your insurable earnings remain stable throughout your leave and are higher than your benefits (which are based on a percentage), this new method of calculation is much more advantageous.
Basic plan: Your income can equal 30% of your weekly insurable earnings (45% for the 25 weeks of parental leave at 55%).
Special plan: They can equal 25% of your weekly insurable earnings.
Scenario
Your weekly insurable earnings (for the calculation of your benefits) are $1,600 and you earned a weekly income of $500 during your benefit period.
Possibility of additional weeks of parental or adoption benefits
One of the new provisions entitles parents who share parental or adoption benefits to additional weeks of shareable benefits.
Basic plan: If you and your spouse have each used a minimum of 8 weeks of parental or adoption benefits, you are entitled to 4 additional weeks of shareable benefits at 55% of insurable earnings.
Special plan: If you and your spouse have each used a minimum of 6 weeks of parental or adoption benefits, you have 3 additional weeks of shareable benefits at 75% of insurable earnings.
Multiple births or adoptions
Under the old plan, parents with multiple births (twins or triplets, for example) would have received the same number of weeks of benefits as if they had only had one child.
The new provisions will entitle these parents to additional weeks of benefits to those already provided for a single birth. This provision is also applicable in the case of multiple adoptions.
Basic plan: 5 weeks added to each parent’s parental/adoption benefits at 70% of insurable earnings.
Special plan: 3 weeks added to each parent’s parental/adoption benefits at 75% of insurable earnings.
Maternity, paternity, parental or adoption benefit periods
In the old plan, the benefit periods had time limits. Maternity benefits had to be taken during a period of 18 weeks after the child’s birth week, while paternity, parental or adoption benefits had to be taken during a period of 52 weeks after the birth.
This situation has been reviewed and improved, increasing the period for maternity benefits to 20 weeks and for the other types of benefits to 78 weeks.
Benefits for single parent
Note that all of these provisions are already in force, but that a final provision will come into force by the end of 2021. It will grant additional benefits to single parents following a birth or adoption.
Basic plan: 5 additional weeks of parental or adoption benefits at 70% of insurable earnings.
Special plan: 3 additional weeks of parental or adoption benefits at 75% of insurable earnings.
Snapshot of the plan with the new provisions:
Make the best decisions
As you can see, the QPIP improvements are significant and will help you better plan your maternity or parental leave. Obviously, the arrival of a child is a big change and calls for a review of your budget to make the necessary adjustments.
Kahina Benbarkat, F. Pl.
Financial Planning Analyst
Want more information on these measures or on other measures which could affect you?
Contact your advisor, who can provide you with more details and even set up personalized tax strategies to meet your more complex needs.
