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.
941640
XXXXXXXXXX J. Brooks
July 27, 1994
Dear XXXXXXXXXX:
This is in reply to your letter of June 20, 1994 in which you requested us to confirm your understanding of the interaction of the Income Tax Act with the Indian Act in a certain type of situation.
In the situation you contemplated, a trust would be settled with funds from land claims settlements. The trust would hold the funds for the benefit of a band (within the meaning of the Indian Act) which has a reserve and/or its members. The sole trustee would be a trust company headquartered off reserve that would conduct operations through a branch located on a reserve. The trust would be able to invest in on reserve or off reserve investments. The beneficiaries of the trust would be either status Indians resident on reserve or the band. You want assurance that income of such a trust would not be subject to income tax.
In our June 20, 1994 letter to XXXXXXXXXX of your department, we outlined our general views on the taxation of Treaty Land Entitlement Trust Property. The situation above that you have asked us to comment on concerns an issue on the residence of a trust which we are not prepared to respond to at the present time. It was not evident to us that this was the issue which you wanted addressed when we agreed during our meeting of June 20, 1994 (XXXXXXXXXX/Dath/Albert) to respond to your query by the end of July. Such an issue would be more appropriately addressed in an advance income tax ruling.
We trust that these comments will be of assistance.
Yours truly,
R. Albert
for Director
Business and General Division
Rulings Directorate
Policy and Legislation Branch
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