A physician and status Indian who lives off the reserve and is the sole shareholder of a corporation that is managed from an office on the reserve spends 70% of his time as employee on the reserve (mostly on patient care) and 30% off the reserve performing hospital duties. After referring to Bell, 2018 FCA 91, CRA stated:
The location of revenue-generating activities and the location of business management and decision-making activities are important factors used by the courts to link business income to a reserve. Consequently, it appears to us, subject to other connecting factors that may apply, that assuming that 70% of the Corporation's business income is located on a reserve, it is possible to consider that when the Corporation pays its business income in the form of salary to its sole shareholder-employee, the Physician, the salary will not be entirely tax-exempt. The proportion of 70% of the salary earned by the Physician could be considered to be situated on the Reserve and would therefore be exempt from tax … .