Qualifying Retroactive Lump-Sum Payment (QRLSP) Statement (Form T1198)
Frequently Asked Questions (FAQs)
1. What is a Statement of Qualifying Retroactive Lump-Sum Payment?
A Statement of Qualifying Retroactive Lump-Sum Payment (or T1198) is created by payers (the Algonquin and Lakeshore Catholic District School Board) to recipients (eligible employees) who received a qualifying retroactive lump-sum payment or payments. There is no legal requirement under the Income Tax Act (ITA) or Income Tax Regulations for a payor to issue this statement and it would typically be requested directly by an individual, but due to the circumstances around Bill 124 payments, ALCDSB will be issuing to eligible employees as outlined below.
2. What is a Qualifying Retroactive Lump-Sum Payment (QRLSP)?
According to the Canada Revenue Agency (CRA), A QRLSP is a lump-sum payment paid to an individual (other than a trust) in a year that relates to one or more prior eligible tax years in which the individual was a resident of Canada for the full year. Employment income received as an order or judgment from a court or other competent tribunal is considered a qualifying amount. "Qualifying" in the context of the QRLSP and employees of the ALCDSB means income paid to CUPE and OECTA employees as a result of the Ontario Superior Court of Justice's decision ruling Bill 124 unconstitutional. These payments were received in relation to the 2019-20, 2020-21, and 2021-22 years. Retroactive lump-sum payments made with respect to the OECTA Voluntary Binding Interest Arbitration are not considered "qualifying" and will not be included on the QRLSP Statement. Principals and Vice-Principals will receive a letter outlining retroactive lump-sum payments received by year with a statement that the Board cannot certify if CRA would consider these payments to be “qualifying”.
3. How do I know if I am eligible to receive the Qualifying Retroactive Lump-Sum Payment Statement?
All active OECTA and CUPE members who received qualifying payments will receive a QRLSP Statement. Inactive OECTA and CUPE members with cumulative QRLSP's exceeding $3,000 will also be issued a QRLSP statement.
4. When will I receive my Statement of Qualifying Retroactive Lump-Sum Payment?
Payroll services will strive to email a QRLSP Statement to all eligible active employees by March 15, 2025 to their board email address. The individual tax filing deadline for 2024 is April 30, 2025. Inactive employees with QRLSP's greater than $3,000 will be mailed QRLSP Statements.
5. What am I required to do?
You are not required to do anything. However, if you would like more information on how a QRLSP Statement could impact you, please consult with your tax professional. If the total of all QRLSPs paid to you exceed $3,000, you can request CRA to do a special tax calculation which would have your QRLSP income redistributed to prior years as if you received the payments in those years. To determine if this would be advantageous to you, please consult with your tax professional.
6. Why does my QRLSP Statement have different amounts than my pay stubs?
QRLSP's must be reported to CRA based on a taxation year (January 1-December 31) whereas retroactive payments were issued based on a school year (September 1-August 31).
7. How do I map my T1198 letter to the CRA form?
ALCDSB issued the email in accordance with Canada Revenue Agency’s requirements for issuing a T1198. CRA allows a form or a letter containing equivalent information from your employer.
Qualifying retroactive lump-sum payments - Canada.ca
If you are completing your own taxes and need to know how to map the payments to the form numbers, it is as follows:
68518 – Total Amount – total as reported in board communication
68519 – Total Principal - total as reported in board communication (there was no interest paid out)
68560 – Current year – 2024
68559 – 1st Prior Year - 2023
68558 – 2nd Prior Year – 2022
68557 – 3rd Prior Year - 2021
68556 – 4th Prior Year – 2020
68554 – 5th Prior Year - 2019
8. I still have questions. Who do I contact?
If you still have questions regarding the QRLSP statement, a further explanation about what a QRLSP is and how it applies to you, and/or whether you should be requesting a special calculation for previous tax years, please contact your tax professional. The ALCDSB cannot provide staff with personal income tax guidance or advice. For payroll-related inquires, please contact [email protected].