Prairie wheat, barley tax credits set for 2010

Prairie wheat growers — and barley growers east of Lloydminster — won’t be able to write off quite as much of their checkoff when filing returns for the 2010 tax year.

The Western Grains Research Foundation (WGRF), which collects checkoffs on Prairie wheat and Saskatchewan and Manitoba barley, on Friday announced a lower percentage of farmers’ checkoffs will be eligible for a federal scientific research and experimental development (SR+ED) tax credit, compared to 2009 levels.

Farmers who paid into the Saskatoon-based WGRF’s checkoffs can claim 74 per cent of their wheat checkoff and 69 per cent of their barley checkoff for the 2010 tax year.

That’s down from 83 per cent for wheat and 76 per cent for barley for 2009.

Alberta barley growers’ $1-per-tonne checkoff is instead collected and managed by the Alberta Barley Commission and thus is subject to a different SR+ED tax credit rate than those on barley in Manitoba or Saskatchewan.

A spokesperson for the Calgary-based commission said Friday the percentage of the 2010 Alberta barley checkoff eligible for the tax credit is 27 per cent, up from 23 in 2009.

The SR+ED-eligible amount in either case then translates to a tax credit at a rate of 20 per cent for individuals, or 35 per cent for Canadian-controlled private corporations.

To their credit

So for example, if a Prairie farmer paid $300 in WGRF wheat checkoffs in 2010, the eligible amount would be calculated by taking 74 per cent (the wheat percentage) of that $300, or $222.

The Prairie farmer, if filing as an individual, would get 20 per cent of that $222, or $44.40, as a SR+ED tax credit.

The same farmer filing as a corporation would get 35 per cent as an SR+ED tax credit, or $77.70.

The percentages announced Friday are the percentages of the checkoff dollars spent directly on eligible research.

Growers who opt out of the checkoff are not eligible for the SR+ED tax credit on their wheat or barley.

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