Tax Deferrals To Aid Drought Affected Producers
CANADA - Livestock producers affected by drought will be eligible for a federal tax deferral.
12 January 2010
2 minute read
"The Government of Canada continues to deliver real results for farmers and ranchers by offering tax deferrals to the producers whose operations are suffering due to the hot, dry season," said Agriculture Minister Gerry Ritz. "These tax deferrals are just another way in which we are working to make sure our livestock producers can remain competitive and profitable."
The tax deferral allows eligible producers in designated areas to defer income tax on the sale of breeding livestock for one year to help replenish breeding stock in the following year. In the case of consecutive years of drought designation, producers may defer sales income to the first year in which the area is no longer designated.
"Earlier this year the government acted quickly to assist producers who are struggling due to drought conditions," said the Honourable Jean-Pierre Blackburn, Minister of National Revenue and Minister of State (Agriculture). "The designation of these additional areas is a result of our continued monitoring of the impacts of the weather on our farmland as well as our hands-on approach to supporting Alberta farmers and ranchers."
Producers who reduced their breeding herds by at least 15 per cent are eligible. Thirty per cent of income from net sales can be deferred if the herd has been reduced by at least 15 per cent, but less than 30 per cent. Where the herd has been reduced by 30 per cent or more, 90 per cent of income from net sales can be deferred.
"A number of regions in Alberta experienced very dry conditions this year," said Agriculture and Rural Development Minister George Groeneveld. "Our provincial and federal governments remain committed to working with Alberta's cattle producers. We continue to monitor soil moisture levels and are watching what is coming next year."
Eligible producers will be able to request this deferral when filing their 2009 income tax returns. Livestock producers are advised to contact their local Canada Revenue Agency Tax Services Office for details on the income tax provisions.
Additional designations are a result of the continuous assessment of the drought situation throughout the fall.
For more information on the extent of the drought or programmes to assist farmers, and an updated list of designated Alberta tax deferral areas, visit the AAFC drought watch site at www.agr.gc.ca/drought.
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