Tax Exemptions Under the Indian Act
Section 87 of the Indian Act outlines the following key exemptions:
Income Earned on a Reserve: Income earned by a registered Indigenous person while working on a reserve is exempt from income tax.
Goods and Services: Goods purchased or services rendered on a reserve may be exempt from GST/HST.
Other Property: Personal property, including investments held on a reserve, may also qualify for tax exemptions.
Who Qualifies for Tax Exemptions?
To qualify, you must:
Be a registered Indian under the Indian Act (status Indian)
Have income, goods, or property that meets the criteria for being connected to a reserve as defined by the Act
How Are Exemptions Applied?
Employment Income: Must be earned on a reserve or connected to an employer based on a reserve
Business Income: The business must operate primarily on a reserve
Pensions and Benefits: May be exempt if the income originates from employment on a reserve
How to Claim Exemptions
Income Tax Returns: When filing your taxes, indicate exempt income and provide supporting documentation, such as a letter from your employer or financial institution confirming the connection to a reserve
GST/HST Exemptions: Present your Certificate of Indian Status (status card) at the time of purchase
Why This Matters
The Indian Act’s tax exemptions recognize the unique legal status of Indigenous peoples under Canadian law and provide financial relief.