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.
Principal Issues: Does a co-operative incorporated under the Cooperatives Act of Manitoba qualify for the Indian Act exemption?
Position: No
Reasons: A corporation is not an Indian or band under the Indian Act.
XXXXXXXXXX 2001-008418
Cornelis Rystenbil, CGA
June 4, 2001
Dear XXXXXXXXXX:
Re: Whether a co-operative is an Indian under the Indian Act
This is in reply to your letter of May 14, 2001, in which you requested our view on whether a co-operative that is incorporated under the Co-operatives Act of Manitoba has to pay corporate income tax.
Written confirmation of the tax implications inherent in particular transactions is given by this Directorate only where the transactions are proposed and are the subject matter of an advance income tax ruling request as set out in Information Circular 70-6R4. Where the particular transactions are completed, the enquiry should be addressed to the relevant Tax Services Office. However, we are prepared to provide the following comments that are of a general nature.
Paragraph 81(1)(a) of the Income Tax Act (the "Act") and section 87 of the Indian Act provide a tax exemption for the personal property of an Indian or band situated on a reserve. A co-operative is generally a corporation; therefore, as such, it is not an "Indian" or "band" as defined in the Indian Act and does not qualify for this exemption. Consequently, in the above situation, if, as you stated, the co-operative is a corporation, it will be taxable on its income unless otherwise exempt from taxation under another provision of the Act.
We trust that these comments will be of assistance.
Yours truly,
Milled Azzi, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
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