First Nations tax

On this page

• Overview
• Paying the FNT
• Registering for the GST/HST
• Charging the FNT
• Reporting the FNT
• Filling out and sending the FNT schedule

Overview

The First Nations tax (FNT) is a tax imposed by a band council or other governing body of a First Nation on their reserves. The CRA administers the FNT for the First Nations that impose the FNT.

The FNT applies at the rate of 5% to sales of listed products made on, or delivered to, all the reserves of the First Nations that impose the FNT. When the FNT applies to a listed product, the GST or the federal part of the HST does not apply.

The FNT may be referred to by a different name, such as a community improvement fee, however, we do not list these other names on this page.

Paying the FNT

Everyone has to pay the FNT on the listed products they buy on, or have delivered to, a reserve where the FNT applies, including individuals registered under the Indian Act, Indian bands and band-empowered entities. This means that the GST/HST relief described in GST/HST Technical Information Bulletin B-039, GST/HST Administrative Policy – Application of the GST/HST to Indians, does not apply to the FNT.

Certain provincial and territorial governments do not pay the FNT. For more information, refer to How the GST/HST applies to provincial and territorial governments.

First Nations that impose the FNT

The following chart shows the First Nations that impose the FNT on the sale of listed products made on, or delivered to, their reserves.

Registering for the GST/HST

You have to register for the GST/HST if you are not a small supplier and you make taxable sales, leases or other supplies in Canada (unless your only taxable supplies are of real property sold other than in the course of a business). Taxable sales, for the purpose of calculating the small-supplier threshold, include sales of listed products that are subject to the FNT.

If you are a GST/HST registrant, the FNT applies to your taxable sales of listed products made on, or delivered to, a reserve where the FNT applies. The GST/HST applies to your other taxable sales (other than zero-rated) of property and services.

As a GST/HST registrant, you may recover the FNT and the GST/HST paid or payable on your purchases and expenses related to your commercial activities by claiming input tax credits.

Learn more:

• When to register for and start charging the GST/HST
• Open or manage an account – Register

Charging the FNT

If you are a GST/HST registrant:

• You have to charge and collect the FNT when you sell listed products on a reserve where the FNT applies
• You have to charge and collect the FNT when you or your agent deliver listed products to a reserve where the FNT applies
• You have to charge the GST/HST when you sell taxable property and services other than listed products. However, an individual registered under the Indian Act, an Indian band or a band-empowered entity may be entitled to relief of the GST/HST if the conditions in GST/HST Technical Information Bulletin B-039, GST/HST Administrative Policy – Application of the GST/HST to Indians, are met

Learn more: Charge and collect the tax – Which rate to charge.

If you are not a GST/HST registrant, do not charge the GST/HST or the FNT to your customers.

Information to include on your receipts or invoices when the FNT applies

You need to let your customers know if tax applies to their purchases and at what rate. You can post signs or use cash register receipts, invoices or contracts to inform your customers whether tax is included in the price or is added separately.

There is no need to change your cash registers or invoicing systems to add the FNT separately from the GST/HST. You also have to give customers who are GST/HST registrants specific information on the invoices, receipts, contracts or other business papers that you use when you supply listed products. They need this information to support their claims for input tax credits or rebates of the FNT or GST/HST you charged.

Learn more: Records you need to support your claim.

Reporting the FNT

If you are a GST/HST registrant and you sell listed products from a reserve where the FNT applies, you are required to file both of the following forms for each reporting period:

• Form GST34-2, Goods and Services Tax/Harmonized Sales Tax (GST/HST) Return for Registrants (or Form GST62, non-personalized version)
• Form GST499-1, First Nations Tax (FNT) Schedule

For more information on how to fill out Form GST34-2, refer to Instructions for completing a GST/HST Return.

You have to file Form GST499-1 at the same time as you file your GST/HST return. Your GST/HST return will include the combined amounts for both taxes (GST/HST and FNT).

If you are a GST/HST registrant and you (or your agent) deliver listed products to a reserve where the FNT applies, you do not have to fill out the FNT schedule. However, you still have to include the FNT in your GST/HST return, as if it were the GST/HST.

For FNT purposes, use the same election forms, rebate applications or other returns that you use for GST/HST purposes.

Filling out and sending the FNT schedule

To fill out Form GST499-1, you will need the following amounts for the reporting period for which you are filing:

• GST/HST and FNT sales
• GST/HST and FNT collected or collectible on your sales
• GST/HST and FNT paid or payable on your purchases

This form has two charts. Fill out all lines of Chart 1 and Chart 2, if applicable. Enter "0" if any amounts on these lines are nil or do not apply to you.

• Chart 1 – if you sell listed products from reserves that are governed by one band council or governing body (do not fill out chart 2)
• Chart 2 – if you sell listed products from reserves that are governed by more than one band council or governing body

You must keep copies of all documents to support your net tax calculations for audit purposes.

For line-by-line instructions, refer to Form GST499-1, First Nations Tax (FNT) Schedule.

If you use a streamlined accounting method such as the quick method to calculate your net tax, contact your tax services office for more information.

For more information on the net tax calculation, refer to Complete and file a return – Calculate the net tax (Methods for calculating your net tax).

After you have filled out your FNT schedule, transfer each amount from the last column of your FNT schedule to the corresponding line on your GST/HST return. For example, transfer line 101C from your FNT schedule to line 101 on your GST/HST return.

After you have copied these amounts, follow the instructions on your GST/HST return for lines 112, 113A, 113B and 113C.

You, or your authorized representative, have to sign the FNT schedule and file it with your GST/HST return. Send your FNT schedule separately by mail no later than the due date of your electronic return.

Filing deadline

The reporting period and the due date for the FNT schedule is the same as for your GST/HST return. You have to file them together.

Learn more: Complete and file a GST/HST return – When to file.

Paying an amount due

If your net tax (line 109 of your GST/HST return) for a reporting period is a positive amount, you have to make a payment. In most cases, your payment is due at the same time as your return.

Learn more: Remit (pay) the tax collected – When to remit (pay).

If you choose to make your payment at your financial institution, you still have to send the FNT schedule separately by mail to the CRA.

To make instalment payments for the GST/HST and the FNT, use Form RC160, Remittance Voucher – Interim Payments.

Learn more: Remit (pay) the GST/HST by instalments. 

If you have a GST/HST refund

If your net tax (line 109 of your GST/HST return) for a reporting period is a negative amount, you can claim a refund.

You can have your refund deposited directly into your account at a financial institution. To sign up for direct deposit, go to Sign in to your CRA account.

Where to send your GST/HST return and FNT schedule

Send your GST/HST return electronically and send your FNT schedule separately by mail no later than the due date of your electronic return to the following address:

Canada Revenue Agency
Prince Edward Island Tax Centre
275 Pope Road
Summerside PE  C1N 6A2