21 March 2001 GST/HST Interpretation 6430 - Indian Band Pension Trust Fund

The information set out in Appendix A was provided in the Email from Suzanne Leclaire to XXXXX Tax Services Office, on January 9, 2001. You were copied on that Email. We responded directly to XXXXX as he had a need for a immediate answer. However, the request for a decision in this matter had been submitted by XXXXX TIS office in XXXXX with the understanding that we would reply to XXXXX, a member of your staff.

Our position is that the guidelines set out in TIB039R that are used to determine whether an entity qualifies as a 'band empowered entity with a presence on reserve' do not apply to the XXXXX Indian Band Pension Trust Fund.

Our response reflects the fact that, at common law, a trust is a legal relationship. A trust has neither members nor shareholders. A trust exists when legal ownership of property is vested in the trustee and the beneficial ownership is vested in the beneficiaries. There is a fiduciary relationship between the trustees and the beneficiaries with respect to the property held within the trust. The trustee's primary obligation is to carry out the instructions of the settlor by exercising powers and obligations of the trust for the benefit of the objects (beneficiaries) of the trust. The beneficiaries generally have no rights or powers against or over the trustees except to insist that the terms of the trust be performed in accordance with the provisions of the trust instrument.

Since a response to the original request has been provided, we will be closing our file; that is, interpretation request, case 6430, previously XXXXX, previously XXXXX. I presume that you will discuss with XXXXX whether there remains a need to respond to the client.

Should you require additional information, please contact me at (613) 954-7957.

Tim Krawchuk
Manager
Aboriginal Affairs Unit

Information provided

The XXXXX Indian Band has established a Retirement Plan for Employees.

The XXXXX Indian Band contributes an amount of money to fund this Retirement Plan for Employees.

The monies contributed will be held 'in trust' and administered by certain Trustees appointed by the Band. These trust funds will be referred to as the XXXXX Indian Band Pension Trust Fund.

The Trustees must act according to the terms of the Trust Agreement.

The Trust Agreement may be terminated at any time by the Band. At that time, all assets of the XXXXX Indian Band Pension Trust Fund will be used for the benefit of the members of the Retirement Plan for Employees.

Issue

Whether the XXXXX Indian Band Pension Trust Fund is a band empowered entity as set out in Technical Information Bulletin B039R.

Decision

The position of CCRA is that the XXXXX Indian Band Pension Trust Fund is not a band empowered entity as set out in Technical Information Bulletin B039R.