Status Indian - Rental income
If you are a Status Indian and are exempt from paying certain
taxes, you must indicate this in the program. This will allow the
program to exempt the income tax you earned on a reserve.
Please complete the first step as follows:
1. On the "Left-side menu on the Interview tab", select
the topic "Interview setup".
2. On the screen to your right, check the box for "Tax return
for a Status Indian". Then go to the "Rental income"
group and check the box "Rental property income" and click
"Next" at the bottom of the page
3. Return to the "Left-side menu on the Interview tab"
and select the "Status Indian".
4. On the page that appears on the right entitled "Status
Indian exemptions", to the question "Please confirm that you
are a Status Indian ", you must answer "Yes" (i.e you
are a Status Indian).
Quebec residents should indicate their information
for the "Quebec drug insurance plan". You should
specify your situation by selecting option "4 - Exceptions,
Quebec insurance plan, all year" and specify the exceptions by
choosing "Registered Indian (code 24)".
To help you determine if your income is taxable or not, we
suggest you visit the following CRA link:
https://www.canada.ca/en/revenue-agency/services/aboriginal-peoples/indians.html
For residents of Quebec, consult the following link:
https://www.revenuquebec.ca/en/businesses/source-deductions-and-employer-contributions/special-cases-source-deductions-and-employer-contributions-in-certain-situations/indian-employee/salary-or-wages-from-employment-duties-performed-partly-or-entirely-on-a-reserve-or-premises/
In general, the income you derive from rental property is not
taxable if the property is located on a reserve.
However, if the property is located outside the reserve, your
net rental income is taxable.
To enter your rental income on a
reserve, follow these steps:
1. On the "Left-side menu on the Interview tab", select
"Rental income".
2. On the page that appears to your right, click on
the plus sign "+" icon to
the right of the line "T776 - Rental Income property".
3. Complete the first page entitled "T776 - Rental property
identification". On the line for "Percentage (%) of personal
use of your rental property", enter your personal use portion
of the building. If you do not live in the building, leave the
field blank.
4. Please indicate whether you are the sole proprietor or
co-owner of the property. To do so, go to the "Type of ownership
of the rental property" line and select the option that applies
best to your situation from the drop-down menu.
5. On the next page, "Income, expenses", enter your
income and expenses in relation to this property.
6. If you used the services of a professional contractor to
repair your building, use the subsection "Labor costs" to
enter the relevant information. Please make sure in this subsection
that the amount paid for the repair has not already been entered in
the expenses beforehand: make sure to choose the appropriate option
from the drop-down menu for the line "Do you wish to add these
labour costs as an expense on the income statement".
7. If you want to claim depreciation for your property, click on
the "CCA" subsection and select the appropriate
class, usually Class 1.
8. At the line "Opening balance of the undepreciated capital
cost", enter the UCC amount that you will find in Section A of
Form T776 in Column 10 of your return for the previous year.
9. If you do not want to claim depreciation on this property, go
to the line "Limit to the CCA of this class" and enter
"$0.00".
10. Subsequently, select the tab "Tax Return", from the
program Header, and from the left-side column, locate the line
"T1 Federal p3" and from line 12600 make note of the
amount of net rental income.
11. Return to "Interview" and on the "Rental property
income and expenses" page, go to the line "Amount of net
rental income exempt under section 87 of the Indian Act" and
enter the amount from line 12600 of the federal return.
No amount will be entered on line 12600 of the federal
return and you can file your return via NETFILE.
However, if your rental property is located outside the
reserve, the net income is taxable.
You must follow the procedure, as indicated in points 1 to 9
inclusively.
Your net rental income will be entered on line 12600 of
the federal return.
ID: 20201130101934NA.xml
Webpage: KPA310-20201130101934NA.htm
