Category: Finance

Building an agile and resilient farm business — AgEx ’17

Resilience is defined as the capacity to recover quickly from difficulties. Agility refers to an ability to move quickly and easily. In a farm business, resilience and agility go hand-in-hand with liquidity and working capital — the ability to put up cash in a short amount of time. “Those are the kind of metrics we… Read more »

Ottawa drops proposal to eliminate deferred cash purchase tickets

The federal government has decided to not make any changes to how it treats deferred cash purchase tickets for grain after proposing in the 2017 budget to potentially eliminate the option. Many farm groups voiced their opposition to the idea of dropping the income tax deferral mechanism during consultations held in spring and early summer…. Read more »

Where to begin with benchmarking your farm business — AgEx ’17 Preview

How often do you stop and take time to evaluate how well your farm business is performing? And how do you determine whether an area of the business is performing well or needing improvement? The first step in benchmarking a farm’s financial performance is to compare it to itself, to understand historical performance. From there,… Read more »

Backtracking on tax changes — what Ottawa’s updates mean for farmers

The dust is starting to settle after Finance Minister Bill Morneau’s flurry of announcements backtracking on the federal government’s proposed small business tax changes. Now that the news conferences are over and we’ve had a few days to analyze the changes to the changes, how will the updates affect farm businesses? First of all, we… Read more »

MacAulay downplays impact of proposed tax changes

Agriculture Minister Lawrence MacAulay continues to downplay the potential impact of the Liberals’ proposed tax changes, despite widespread concerns voiced by many farmers, small business owners and their accountants. The minister took 10 minutes to sit down with RealAgriculture in his office in the Confederation Building on Parliament Hill this week to discuss the tax… Read more »

Tax change answers — Part 3: Capital gains

The federal government wants to clamp down on incorporated business owners who it says are claiming capital gains when they should be reporting taxable income or dividends. A capital gain is essentially the increase in the value of a capital asset, such as farmland, above its purchase price. Under Canada’s tax system, only 50 percent… Read more »

CFA lobbies for more time and changes to government tax proposal

Members of Parliament are back at their seats for the fall sitting of Parliament, and tensions are high, with the Conservatives and NDP questioning the Liberals’ proposed tax changes announced in July. Farm groups and farmers have also been vocal in criticizing the government’s plan. “I don’t think the government realized the opposition that would… Read more »

Tax change answers — Part 1: Income splitting

There’s a reason most farms pay accountants to provide tax planning advice. Taxes are complicated. Add multiple pages of new information, unclear definitions, ‘tax cheat’ accusations, some emotional rhetoric, and it’s a challenge, even for accountants, to assess what Finance Minister Bill Morneau’s proposed tax changes could mean for an individual farm business. We’re going… Read more »

Ag minister avoids saying much on tax changes

With farmers, farm organizations, and accounting firms that work in agriculture voicing serious concerns about the federal government’s proposed tax changes, Agriculture Minister Lawrence MacAulay broke his media silence on the subject on Friday afternoon. For all of 50 seconds. The Full Story: Facing the politically dangerous choice of siding with the farm community or… Read more »

Getting crunched: Government squeezes on farms are adding up

I’m fortunate enough to get to meet all kinds of farmers. Usually when we meet, the conversation is a standard one. What’s the weather been like or how is the harvest going? Politics, just like sex and religion, is usually left out of it. Until recently. Farmers keep bringing it up in their conversations. That… Read more »

Ag ministers reach deal on new framework dubbed the “Canadian Agricultural Partnership”

Agriculture ministers from across Canada say they reached an agreement in St. John’s today on the core elements of the next agriculture policy framework, which will be called the “Canadian Agricultural Partnership.” CAP is a five-year $3 billion federal-provincial-territorial funding agreement that will replace the current framework, known as Growing Forward 2, which expires at the… Read more »

MYFB — Ep. 25: Steering through business risk and financial risk (and what’s the difference?)

Risk — a four letter word that drives farmers crazy. As farmers, our chances of success are greatest when we know the risks we’re exposed to and hav emitigated risks that are in our control. To help us dive deeper into the topic of risk – specifically business risk and financial risk – RealAgriculture’s Shaun… Read more »

Canadian net farm income grew 7.6% in 2016: StatsCan

StatsCan has released its net farm income report for 2016 and the results may surprise you considering the livestock and commodity market that producers faced. According to the report, revenue held fairly stable while it was declining operating expenses that allowed net farm income to rise. A full breakdown of the report, including provincial comparisons,… Read more »

Ottawa extends consultation on potential elimination of deferred cash tickets

The federal government is extending the comment period for its proposal to potentially eliminate the deferred cash ticket option for grain sales. The department of finance, on Tuesday, announced the consultation period that was originally scheduled to end May 24th will remain open beyond seeding season, until July 24. When delivering a listed grain (such… Read more »

MYFB — Ep 24: Can break-even be your worst case scenario?

If when you think of risk in farming you think only of uncontrollable things, like the weather and global trade, or only crop price slides, you’ve likely missed an opportunity to take a more proactive approach to risk management. While it’s easy to get overwhelmed by ‘what if’ scenarios and all the different forms of… Read more »