T4 Code 71 — Indian (exempt income) — employment
Employment income exempt from tax under §87 of the Indian Act — reported for information only, not added to taxable income.
At a glance — Code 71
- Box name
- Indian (exempt income) — employment
- T1 line
- Not reported on T1 directly
- Check against
- Your Status card and the location of employment duties (generally must be on reserve).
What Code 71 means
Code 71 reports employment income earned by a person registered under the Indian Act that is exempt from tax under §87. The exemption applies when income is "situated on a reserve" — typically when work is performed on reserve or the employer resides on reserve.
The amount is NOT included in Box 14 and is NOT taxed. Code 71 is purely informational so CRA can match the employer's T4 records against your return.
The CRA uses four "Connecting Factors" (residence of employee, employer, duties, purpose) per the Guidelines for Employment Income to determine if income qualifies.
Tax return implications
- No tax effect — informational only.
- Still need to file a T1 if you have other taxable income or want to claim credits (GST/HST credit, CCB, etc.).
- CPP/EI may or may not apply depending on whether you opted in (Code 71 typically has no CPP/EI).
FAQ
Do I need to file a tax return if all my income is in Code 71?
Not strictly required — exempt income does not create a filing obligation. But filing is often worthwhile to claim the GST/HST credit, Canada Child Benefit, provincial credits, and to establish RRSP room (note: exempt income does not create RRSP room).
Related T4 boxes
Code 66 — Eligible retiring allowance
Severance eligible for transfer to an RRSP without RRSP room — limited to $2,000 per year of pre-1996 service.
Code 67 — Non-eligible retiring allowance
Severance portion not eligible for direct RRSP transfer — fully taxable, but may still use regular RRSP room.
Code 77 — Workers' compensation benefits repaid to the employer
WCB top-up you repaid to your employer — creates an offsetting deduction at Line 22900.
Box 14 — Employment income
Your total gross employment income for the year before any deductions — salary, wages, bonuses, commissions, taxable benefits and most other pay.
Filing your return? Use the payroll deductions calculator to verify the amounts on your T4 match expected CPP, EI and income tax withholdings, and the income tax calculator to estimate your refund or balance owing.
Sources
T4 box definitions from CRA T4 employer guide. Rates and thresholds current for 2025; file your 2025 T1 by April 30, 2026 (self-employed June 15).