Labour-Sponsored Fund Tax Credit 2026: 30% on $5,000 (FTQ and Fondaction)
In Quebec in 2026, buying shares of the Fonds de solidarité FTQ or Fondaction entitles you to 30% in non-refundable tax credits, 15% from Quebec and 15% from the federal government, on the first $5,000 per year: the maximum credit is therefore $1,500, or $750 from each government, before the RRSP deduction even enters the picture.
This is one of the few tax breaks that exists only in Quebec, and fall is when the question comes back: the FTQ opened a special subscription period on October 5, 2026, and purchases made before December 31, 2026, count for the 2026 tax year. There is another reason to look closely this year: in 2026, no income cap limits access to the credits, but tighter rules arrive in 2027 for the highest incomes. Here are the exact rules, the math and the traps, before you decide.
Want to measure the effect on your total tax? Calculate your Quebec income tax with our calculator, then compare with and without the $1,500 in credits before you subscribe.
Who can claim the 30% credits in 2026?
You can claim the credits if you live in Quebec, are 18 or over, and buy, as first purchaser, class A shares of the Fonds de solidarité FTQ or class A or class B shares of Fondaction, during the calendar year or in the first 60 days of the following year. In 2026, there is no taxable income cap: even a high income qualifies for the full credits this year.
Both credits are non-refundable: the Quebec one, claimed on line 424 of your provincial return with your RL-10 slip, and the federal one, on lines 41300 and 41400. Each one reduces the tax you owe, without ever creating a refund on its own. You therefore need tax owing at both levels to get the full benefit.
How is the maximum $1,500 credit calculated?
The math is simple: each government applies 15% to the amount of eligible shares, and the amount taken into account is capped at $5,000 per tax year, across both funds combined. Buying $5,000 at the FTQ and another $5,000 at Fondaction in the same year does not double the credits: the $5,000 cap applies to the total.
| Eligible shares purchased | Quebec credit (15%) | Federal credit (15%) | Total credits |
|---|---|---|---|
| $1,000 | $150 | $150 | $300 |
| $2,500 | $375 | $375 | $750 |
| $5,000 | $750 | $750 | $1,500 |
| $7,000 | $750 | $750 | $1,500 |
If you buy more than $5,000 of shares in one year, the portion of the issue price above the cap can be carried forward and used in the credit calculation for a later year, based on the amounts on your RL-10 slip. Check your estimated pay with our Quebec pay calculator if you contribute by payroll deduction: the savings can then show up on each pay instead of in the spring.
How much is it worth, in real terms, with $5,000 and a $40,000 salary?
Take a Quebec employee who earns $40,000 in 2026, with a combined marginal tax rate of 25.7%, the rate the FTQ uses in its examples for the 2026 tax year. They subscribe for $5,000 of shares and hold them in the fund's RRSP, what the FTQ calls the RRSP+.
The benefits stack up: $1,500 in labour-sponsored fund tax credits, plus the $5,000 RRSP deduction which, at 25.7%, is worth $1,285. Total savings: $2,785. Their real net cost for $5,000 of savings is therefore $2,215. With an ordinary RRSP at the same marginal rate, the same $5,000 contribution would be worth only $1,285 in savings: the credits add a full $1,500 more.
With a smaller $3,000 subscription, still inside an RRSP and at the same rate: $900 in credits, plus $771 from the RRSP deduction, for $1,671 in savings and a net cost of $1,329. This is the calculation to redo with your own marginal rate before choosing your amount.
Do the shares have to be held in an RRSP to get the credits?
No. The 30% credits are independent of the RRSP deduction. You can hold the shares outside an RRSP and still receive the $1,500 in credits on $5,000. That is useful if your RRSP room is already full: the RRSP deduction disappears, but the credits remain, as long as you have tax to pay.
If you do have RRSP room, holding the shares in the fund's RRSP stacks both benefits, as in the example above. Be careful not to exceed your RRSP room: the credits do not protect you from the 1% per month penalty on excess RRSP contributions. And as you plan your year-end moves, combine this choice with our guide to year-end tax moves to make before December 31, 2026 so nothing is missed.
What changes in 2027 for high incomes?
Starting with the 2027 tax year, an individual whose taxable income for the reference year was taxed at the highest rate will no longer be able to receive the credit for shares subscribed after December 31, 2026. Federal rules follow the same logic: the federal credit is granted only if the Quebec credit is also available, so losing Quebec eligibility takes away the full 30% in credits at once.
For 2025 and 2026, no cap of this kind applies. In practical terms, 2026 is the last year in which a high income, for example above the top bracket, still qualifies for the full $1,500 in credits. If your situation fits and the lock-in works for you, that is a timing argument, not a reason to buy without reading the traps below.
What are the traps to know before you subscribe?
The first trap is liquidity: these shares are a retirement investment. As a general rule, redemption is possible only at retirement or in certain situations set out in the prospectus, such as disability, and redeeming too early can mean repaying the credits you received. Money placed here is not an emergency fund.
Second trap: the value of the shares is not guaranteed, it fluctuates, and past performance does not guarantee future returns, as both funds state in their official documents. Third trap: the credits are non-refundable, so a low income with little tax owing can leave part of the credits unused in the year of purchase. Read the prospectus of the fund you choose before subscribing: it is the binding document.
How do you claim the credit on your 2026 return?
The fund sends you an RL-10 slip: for a purchase made before December 31, 2026, the FTQ says the slip will be in the online account around mid-January 2027; for a purchase in the first 60 days of 2027, around mid-March 2027, and you can then choose to attach the purchase to your 2026 year. Keep that slip: it is the proof of the amounts.
On your Quebec return, the credit goes on line 424. On your federal return, you enter the net cost on line 41300 and the credit on line 41400. If the shares are in an RRSP, your RRSP deduction is claimed as usual, separately from the credits. Before filing, compare your result with our Quebec income tax calculator to spot any gap.
Frequently asked questions
What is the maximum labour-sponsored fund credit in 2026?
The maximum credit is $1,500 per person for the 2026 tax year: $750 from Quebec (15%) and $750 from the federal government (15%), calculated on the first $5,000 of eligible shares of the Fonds de solidarité FTQ or Fondaction. Above $5,000, the credits no longer increase for the year, but the unused portion of the issue price can be used in the calculation for a later year, based on your RL-10 slip.
Can you combine the FTQ and Fondaction credits in the same year?
You can buy shares of both funds in the same year, but the $5,000 amount taken into account for the credits applies to the total of both, not to each fund separately. Buying $5,000 at the FTQ and $5,000 at Fondaction therefore gives the same $1,500 maximum credit as a single $5,000 purchase. The excess can, however, be carried forward for the calculation of a later year.
Do you need RRSP room available to receive the 30% credits?
No. The 30% tax credits are independent of the RRSP deduction: you can hold the shares outside an RRSP and receive the full credits, even if your RRSP room is full. RRSP room only serves to add the RRSP deduction on top of the credits, as in the FTQ's RRSP+. If you owe no tax, however, the non-refundable credits can remain partly unused.
Do high incomes lose the credits in 2026?
No, not in 2026: no taxable income cap limits access to the credits for the 2025 and 2026 tax years. The tightening starts with the 2027 tax year: an individual whose taxable income for the reference year was taxed at the highest rate will lose the credit for shares subscribed after December 31, 2026, and the federal credit will fall at the same time, because it requires eligibility in Quebec.
Can FTQ or Fondaction shares be redeemed at any time?
No. These are investments designed for retirement: as a general rule, redemption is allowed only at retirement or in certain situations set out in the prospectus, such as disability, or returning to school in some cases. A redemption that does not follow the rules can mean repaying the tax credits received. Only place money there that you will not need before retirement, and read the prospectus before subscribing.
Which slip do you need to claim the credit on your return?
The fund issues an RL-10 slip showing the cost of the shares and the credits. At the FTQ, a purchase made before December 31, 2026, produces a slip available around mid-January 2027, and a purchase in the first 60 days of 2027, around mid-March 2027. With that slip, you claim the Quebec credit on line 424 and the federal credit on lines 41300 and 41400 of your returns.
Official sources
- Revenu Québec — Tax Credit for a Labour-Sponsored Fund
- Canada Revenue Agency — Labour-sponsored funds tax credit (lines 41300 and 41400)
- Ministère des Finances du Québec — Crédit d'impôt pour contributions à un fonds de travailleurs
- Fondaction — Le saviez-vous ? (crédits de 30 %, aucun plafond avant 2027)