ARCHIVED CD 1996-053
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November 25, 1996
SUBJECT: Status Indian Employee Working on a Reserve - Québec
1.1 The purpose of this directive is to advise departments of new reporting requirements for income earned by a Status Indian employee working on a reserve in Québec.
2.1 This directive supersedes and cancels Services Pay Directive 1989-132 (43) dated October 13, 1989, entitled "Indians Working on a Reserve - Québec".
3.1 The ministère du Revenu du Québec has announced that the reporting requirement for Status Indian income earned on a Québec reserve has changed with the 1996 taxation year.
3.2 Income earned by a Status Indian employee while working on a reserve in Québec, although it remains tax-exempt, should now be reported on the Relevé 1.
4.1 Effective with the 1996 taxation year, the ministère du Revenu du Québec requires that tax-exempt income earned by a Status Indian employee while working on a reserve in Québec be reported on the Relevé 1 in a new box R, "Tax-Exempt Income Paid to an Indian".
This tax-exempt income is still not to be included in box A "Employment Income" on the Relevé 1.
5.1 The Regional Pay System has been modified to automatically report, in Box R of the Relevé 1, the income earned by a Status Indian employee where the employee's entire earnings for the taxation year were earned while working on a reserve in Québec.
5.2 Where, during the same taxation year, the employee's income as a Status Indian was not earned exclusively while working on a reserve in Québec, the Regional Pay System will not automatically report an amount in box R of the Relevé 1.
In this situation, departments will be required to report to the pay office, the amount of income earned by the Status Indian employee while working on a reserve in Québec.
Please note that earned income includes taxable benefit amounts but excludes amounts awarded by the Workman's Compensation Board (WCB) for any period considered as working on the reserve in Québec. Departments will be required to contact the Commission de la santé et de la sécurité au travail (CSST) in order to obtain the amount awarded for the period while working on a reserve in Québec.
5.3 Element 744 of the Master Employee Record will be renamed as "Indian Income Working on a Reserve in Québec". This element will be used to report the income earned while working on a reserve in Québec for those Status Indian employees who did not work exclusively on a Québec reserve during the year.
5.4 The pay office, upon written notification from the department, will process a Pay Action Code (PAC) 30 to credit element 744 by the amount reported.
Please note that element 744 will not be available until January 1997. Therefore, when updating the 1996 element, the pay office should update the previous year element MP 744. The availability of element 744 will be confirmed by Program Release (RLS).
6.1 Any request for information regarding the foregoing should be addressed to your Public Works and Government Services Canada (PWGSC) Compensation Services Office.
Original Signed by
Government Operational Service
Reference CJA 9007-7, CJA 9007-8
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