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Zones widened for drought-induced tax deferrals

More livestock producers in all four western provinces will be eligible to defer part of their income taxes from the sale of animals in cases where drought forced a producer’s hand.

In four separate press releases Tuesday, the federal government expanded the drought-induced income tax deferral zones to include 48 more rural municipalities in southern Saskatchewan, 13 RMs in southwestern Manitoba, three more regional districts in British Columbia and three more districts in northern Alberta.

Producers in the added regions who were forced to sell all or part of their herd due to drought conditions may now also be eligible for a one-year tax deferral on 2008 income from these sales. Eligible producers can request this deferral when filing their income tax returns for 2008.

To be eligible, producers must have reduced their breeding herds by at least 15 per cent, allowing them to defer tax on 30 per cent of income from net sales. But if a producer has had to sell to downsize a breeding herd by 30 per cent or more, then the tax on 90 per cent of income from net sales can be deferred.

Such a deferral allows eligible producers in the designated areas to defer income tax on the sale of breeding livestock for a year, which is expected to help them when it comes time to replenish breeding stock in the following year.

In the case of consecutive years of drought designation, a producer can defer sales income to the first year in which his or her area is no longer designated.

The 48 Saskatchewan RMs added to the list as of Tuesday include, in alphabetical order, Argyle, Arlington, Baildon, Benson, Bone Creek, Bratt’s Lake, Brokenshell, Browning, Caledonia, Cambria, Caron, Coalfields, Cymri, Elmsthorpe, Enniskillen, Estevan, Francis, Frontier, Griffin, Hillsborough, Key West, Lac Pelletier, Lajord, Lake Alma, Lake Johnston, Laurier, Lomond, Marquis, Moose Creek, Moose Jaw, Mount Pleasant, Norton, Pense, Reciprocity, Redburn, Rodgers, Scott, Shamrock, Sherwood, Storthoaks, Souris Valley, Tecumseh, Terrell, The Gap, Wellington, Weyburn, Whiska Creek and White Valley.

The 13 Manitoba RMs now added to the list include, also in alphabetical order, Albert, Arthur, Brenda, Cameron, Edward, Glenwood, Killarney-Turtle Mountain, Morton, Pipestone, Riverside, Sifton, Whitewater and Winchester.

Municipalities added to the Alberta list, as announced last week by the provincial government, include Birch Hills County and the municipal districts of Fairview and Spirit River.

The Regional Districts of East Kootenay, Central Kootenay and Kootenay Boundary in British Columbia are now also on the designated list.

Added in December to the list of 2008 tax-year deferrals were the Peace River Regional District in B.C., Alberta’s County of Grande Prairie No. 1 and its municipal districts of Saddle Hills and Clear Hills, and the Saskatchewan RMs of Surprise Valley, Happy Valley, Hart Butte, Poplar Valley, Val Marie, Lone Tree, Bengough, Willow Bunch, Old Post, Waverley, Mankota, Glen McPherson, Excel, Lake of the Rivers, Stonehenge, Wood River, Pinto Creek, Auvergne, Wise Creek, Grassy Creek, Sutton, Gravelbourg and Glen Bain.

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