1993 Internal T.I. 9311837 F - Indian Exemption

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

January 11, 1994

Attention:  Beth Roy

XXXXXXXXXX

Exemption Under The Indian Act

This is in reply to your round trip memorandum of April 19, 1993, wherein you asked whether employment income of an Indian living on a reserve and performing duties off reserve as a school teacher XXXXXXXXXX

Facts:

XXXXXXXXXX

XXXXXXXXXX

Our Comments:

In the 1991 year employment income was exempt if the employer was resident on the reserve or the employee worked on the reserve. As the employer, being the XXXXXXXXXX government, is not resident on the reserve nor does the employee work on the reserve, the employment income was taxable.

As you may be aware, the 'Indian Act Exemption for Employment Income Detailed Guidelines' were issued by the Department on December 15, 1993 in response to the Williams decision (92 DTC 6320) and are relevant for taxation years after 1991. For years subsequent to 1991, connecting factors must be considered. The only connecting factor present in this situation is the fact that the individual lives on the reserve. The employer is not located on the reserve and the work location is off reserve. The facts that the duties relate wholly and solely to Native students and that the employment relates to an agreement made between a Band Council and a school should not be given enough weight to connect the income to the reserve. In addition, the Indian Income Tax Remission Order will extend tax exemption under the Nowegijick situs of the debtor test until the end of 1994. However, it will not be applicable in this situation.

Your file is attached hereto.

R. Albert for DirectorBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch

Attachment