By Mark Wales, Director, Ontario Federation of Agriculture
Special to Nation Valley News
Incorporated farm businesses in Ontario are facing devastating tax implications if the federal government approves proposed changes to the private corporation tax system. About 25 percent of farm businesses in Ontario and Canada are incorporated, and could be hit with a hike in accounting and succession planning fees, and severe limitations on farm transfer options to the next generation.
The implications of the proposed tax changes could be damaging to farm businesses across the country. Many farms, including incorporated farms, are passed down from generation to generation Incorporation is a way of structuring a business that many farmers and small business owners across Canada have decided makes sense for their business. But the term ‘corporate’ has no bearing on the size or type of farm. Incorporated farm businesses in Canada are mostly family owned and operated. Incorporation of any farm is a serious business decision that often comes with increased complexity and fees from advisors such as accountants and lawyers. One of the primary reasons businesses choose to incorporate is to limit their liability and protect their personal assets such as their home. Incorporation can also play a key role in passing the family farm business down to the next generation and ensure the continuity of the business. That’s why Ontario and Canadian farmers aren’t taking the proposed changes lightly.
Consultations on the tax changes are only open until October 2 with implementation scheduled for January, 2018. This aggressive schedule immediately undoes a generation or more of succession planning and requires quick decisions to be made that will significantly affect future generations. The Ontario Federation of Agriculture (OFA) is asking all farmers – especially those with incorporated farm businesses who will be impacted by these proposed changes – to talk to their MP about the serious implications to primary agriculture and farmers across Canada.
We have to act now. And OFA is making it easy to speak up and tell our elected officials that Canadian farm businesses won’t stand for this drastic overhaul of the private corporation tax system that would add complexity and uncertainty to any farmer with an incorporated farm business. Visit actnow.ofa.on.ca to speak up and send a letter to your MP letting them know the changes will be devastating to your farm and farmers across Ontario and Canada. We need to act now, consultations are only open for a few more weeks and if approved, these changes will go into effect on January 1, 2018.
The federal government needs to understand the consequences of these proposed tax changes and the impacts they could have to farmers, farm families, rural communities and our agri-food industry are simply unacceptable.