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.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
ADM'S OFFICE (3) ADM 940336
RETURN TO RULINGS, ROOM 303, MET. BLDG.
AUTHOR
SUBJECT OR CORPORATE FILE
May 25, 1994
XXXXXXXXXX
Dear XXXXXXXXXX:
Thank you for your letter of March 24, 1994, regarding the draft Indian Act Exemption for Employment Income Detailed Guidelines (the "Guidelines"). I apologize for the delay in responding.
You have asked for our comments regarding the application of the Guidelines to a corporation which operates a general/hardware store located off the reserve and is owned by a Band. The store employs status Indians who reside on the reserve. The Board of Directors of the corporation is composed of band, staff and Council members of the band and it generally holds its meetings on the reserve. In particular, you have asked whether the corporation would be considered resident on a reserve such that Guideline 2 applies to exempt the income of its employees.
The Department considers the residence of an employer to be where its central management and control lies. Central management and control of an organization is normally considered to be exercised by the group that performs the function of a Board of Directors of the organization. However, it may be that the real management and control of an organization is exercised by some other person or group. Generally, management and control is exercised at the principal place of business but it is recognized that this function may be legitimately exercised in a place other than the principal administrative office of the organization. It is a question of fact where the central management and control is exercised.
Accordingly, the determination as to whether the employment income of a status Indian employed by the corporation would be exempt from tax under the Guidelines should ultimately be made by your District Office. I suggest that you contact Mr. Dennis M. Luciuk, Director of the Vancouver District Office for his assistance, at the following address:
1166 West Pender Street
Vancouver, British Columbia
V6E 3H8
Upon considering the representations that we have received, the Guidelines will be finalized, and at that time, we will send you a copy of the final Guidelines.
Yours sincerely,
Denis Lefebvre
Assistant Deputy Minister
Legislative and Intergovernmental
Affairs Branch
C. Chouinard
957-2098
May 18, 1994
940822
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