Indian workers and the Canada Pension Plan

We recognize that many First Nations people in Canada prefer not to describe themselves as Indians. However, we use the term Indian in these pages because it has a legal meaning under the Indian Act.

Under the Indian Act, an Indian means a person who pursuant to this Act is registered as an Indian or is entitled to be registered as an Indian.

Special rules apply to Indian workers. You will find information to help you determine if an Indian worker can participate or not in the Canada Pension Plan (CPP).

How to obtain an application for coverage of employment of an Indian in Canada under the Canada Pension Plan whose income is exempt under the Income Tax Act.

Election by the Employer

The employment of an Indian hired pursuant to a contract of service (employer/employee relationship), whose earnings are not included in computing income for purposes of the Income Tax Act is excepted from pensionable employment. However, conditions have been established to enable the worker to participate in the CPP. Accordingly, the employment of an Indian may be included in pensionable employment provided the following conditions are met:

The employer must complete, in prescribed form, a CPT124 - Application for Coverage of Employment of an Indian in Canada under the Canada Pension Plan Whose Income is Exempt under the Income Tax Act.

Election by the Employee

Where the employer does not elect to cover Indian employees under the CPP, an Indian's employment may still be included in pensionable employment provided that all of the following conditions are met:

Self-Employment on a Reserve

A self-employed Indian's income from self-employment on a reserve is not included in contributory earnings for CPP purposes. However, a provision of the Canada Pension Plan Regulations has the effect of negating this exclusion under the Canada Pension Plan. Consequently, an Indian who is self-employed on a reserve can participate in the CPP.

An Indian who is self-employed on a reserve and wishes to participate in the CPP must meet the following conditions:

Note

Indians living on reserves in the province of Quebec should contact Revenu Québec for information concerning participation in the Québec Pension Plan.

Need more information?

To get more information, call 1-800-959-5525.

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