The Department of Agriculture and Food has published an early list of areas that will be eligible for the livestock tax deferral in 2024.
Agriculture Minister Lawrence MacAulay made the announcement on June 14 to “provide further certainty for producers heading into the summer”.
The livestock tax deferral provisions allow livestock producers in certain areas who are forced to sell all or part of their breeding stock because of drought, floods, or excessive moisture to defer a portion of the proceeds from the sale until the following tax year. The proceeds are at least partially offset by the replacement costs of the breeding stock, thereby reducing the tax liability associated with the original sale.
The government says it has streamlined the process of identifying areas early in the growing season and created buffer zones in adjacent areas to catch producers on the edge of affected areas. Farms within adjacent areas that may be experiencing drought or excess moisture can benefit from livestock tax deferral provisions. Areas that meet the eligibility criteria of more than 50% feed shortage due to drought or excess moisture will be added to the list, according to AAFC.
To qualify for a deferral of income under the livestock tax deferral provisions, your herd size must have decreased by at least 15%.
If drought, excess moisture or flood conditions persist for multiple years, producers may defer sales revenue until the first year that the area is no longer subject to the designation.
AAFC notes that some areas may see feed production capacity recover later in the growing season based on actual conditions, but once areas are defined, they will be subject to deferrals for the duration of the tax year.
“Weather, climate and production data across Canada will continue to be monitored throughout the remainder of the season and areas that meet the criteria will be added to the list,” the AAFC said.
For a complete, detailed list of areas designated to date, see click here.
