Several years ago on Twitter, a farmer joked that farming is borrowing $800,000 in spring and burying it, hoping that it yields $850,000 in fall. This year may be the most expensive input crop in history, and this highlights the risk that producers face. With rising interest rates, I recommend reviewing your 2023 input financing […] Read more
Tag Archives In the Farmyard column — page 2
Weigh the options when deciding corporate compensation
What’s the best way to pay yourself from your corporation? The right mix of the options depends on your individual tax situation. Wages Reasonable wages can be paid to anyone who works for the corporation and are considered a tax deduction to the corporation. Wages to people who own more than 40 percent of the […] Read more
Base AgriInvest withdrawal on tax rate, use of money
Should AgriInvest funds be withdrawn? It depends on your tax rate upon withdrawing and how you will use the money. If the AgriInvest is filed, the producer will receive an AgriInvest deposit notice that they can deposit up to $10,000 in the AgriInvest account within the next 90 days. The government will then match this […] Read more
Planning options available for too much taxable income
Most farms are taxed on a cash basis and there are many taxable income management tools available to farm operations that other industries envy. These tools help manage uncertain earnings fluctuations that producers experience while allowing producers to access the beneficial tax brackets and rates. The farming lifecycle usually begins with proprietorships and as profits increase there […] Read more
Immediate expensing can help create huge tax deduction
On April 19, 2021, the government announced immediate expensing (100 percent writeoff in the year of purchase) for up to $1.5 million of equipment purchases per year for corporations to temporarily stimulate small businesses. An election and pandemic delays later, this finally became law in June 2022, allowing Canada Revenue Agency to start assessing immediate […] Read more
