Farming Income and the AgriStability and AgriInvest Programs Guide - 2018 - GST/HST rates

From: Canada Revenue Agency

Farm goods and services subject to GST or HST include:

  • crop dusting
  • contract work, including field clearing, tilling, harvesting done by one farmer on behalf of another
  • road-clearing services
  • stud or artificial insemination services
  • storing goods (for example, storing grain in a grain elevator)
  • beeswax
  • maple sugar candy
  • canary seed, lawn seed, and flower seed
  • bedding plants, sod, cut flowers, living trees, and firewood
  • furs, animal hides, and dead animals not suitable for human consumption
  • fertilizer in bulk quantities of less than 500 kg, or any quantities of soil or soil mixture whether or not it contains fertilizer
  • gravel, stones, rock, soil, and soil additives
  • livestock or poultry not normally raised as food or to produce food for human consumption (for example, horses, mules, rabbits, exhibition poultry, and mink)
  • processed wool, feathers, and down

Many farm products and purchases, such as milk sales and feeder-cattle purchases, are taxable, but at 0%. We refer to these as zero-rated. You do not pay GST/HST when you buy these products and you do not charge GST/HST when you sell them to your customers.

Zero-rated farm products are:

  • fruit and vegetables
  • grains or seeds in their natural state, treated for seeding purposes or irradiated for storage purposes, hay or silage, or other fodder crops, when they are sold in quantities larger than ordinarily offered for sale to consumers, except grains and seeds sold to use as feed for wild birds or pet food
  • feed sold by a feedlot operator, as long as the price is separately identified on the invoice or written agreement
  • hops, barley, flaxseed, straw, sugar cane, or sugar beets
  • livestock such as cattle, hogs, poultry, bees, or sheep that are raised or kept to produce food, or to be used as food, for human consumption, or to produce wool
  • poultry or fish eggs that are produced for hatching
  • rabbits, except those that are to be sold as pets
  • frozen, salted, smoked, dried, scaled, eviscerated or filleted fish, or seafood sold for human consumption
  • fertilizer sold in individual bags of at least 25 kg when the total quantity is at least 500 kg
  • wool that is not further processed than washed
  • tobacco leaves that are not further processed than dried and sorted

Zero-rated farm purchases are:

  • large farm tractors (60 PTO hp. and over)
  • pull and self-propelled combines, swathers, and wind-rowers
  • headers for combines, forage harvesters, swathers or wind-rowers
  • combine or forage harvester pickups
  • forage harvesters, and self-propelled, tractor-mounted, or pull-type mechanical fruit or vegetable pickers or harvesters
  • mouldboard and disc ploughs (3 or more furrows), and chisel ploughs and subsoil chisels (at least 8 feet or 2.44 metres)
  • discers, rod weeders, or bean rods (at least 8 feet or 2.44 metres)
  • field and row crop cultivators (at least 8 feet or 2.44 metres)
  • combination discer-cultivators (at least 8 feet or 2.44 metres)
  • rototillers and rotovators (at least 6 feet or 1.83 metres)
  • harrows sold in complete units and pulverizers (at least 8 feet or 2.44 metres)
  • land packers, mulchers, and rotary hoes (at least 8 feet or 2.44 metres)
  • airflow seeders, grain and seed drills (at least 8 feet or 2.44 metres), and farm-type row-crop or toolbar seeders or planters designed to seed two or more rows at a time
  • mower conditioners, hay balers, hay cubers, hay rakes, hay conditioners, hay crushers, hay crimpers, hay tedders, swath turners, and wind-row turners
  • bale throwers, elevators, or conveyors, silage baggers and round bale wrapping machines
  • grain bins or tanks with a capacity of 181 me or less (5,000 bushels)
  • transportable grain augers, utility augers, elevators and transportable conveyors with belts less than 76.2 cm (30 inches) wide and 0.48 cm (3/16 inch) thick
  • bin sweep or cleaner attachments for portable grain augers
  • tractor-powered pneumatic grain conveyors
  • feed mills, including roller mills and hammer mills
  • feed mixers, grinders, grinder mixers, and tub grinders
  • ensilage mixers, and self-propelled feed or ensilage carts
  • grain toasters to use in livestock feed production
  • grain dryers
  • farm bulk milk coolers
  • assembled and fully operational milking systems or individual components of these systems
  • automated and computerized farm livestock or poultry feeding systems or individual components of these systems
  • self-propelled, tractor-mounted, or pull-type agricultural wagons or trailers designed for off-road handling and transporting of grain, forage, livestock feed, or fertilizer, and to be used at speeds not exceeding 40 km per hour
  • mechanical rock or stone pickers, rock or root rakes, and rock or root wind-rowers, forage blowers, silo unloaders, and shredders with an operational width of at least 3.66 m or 12 feet
  • tractor-mounted, self-propelled, or pull-type field sprayers with tank capacities of at least 300 litres or 66 gallons
  • granular fertilizer or pesticide applicators with an operational capacity of at least 0.2265 cubic metres or 8 cubic feet
  • liquid box, tank, or flail manure spreaders and injection systems for liquid manure spreaders
  • leafcutter bees
  • complete feeds, supplements, micro-premixes, macro-premixes, and mineral feeds other than trace mineral salt feeds, labelled in accordance with the Feeds Regulations, and designed for rabbits or a specific type of farm livestock, fish, or poultry ordinarily raised or kept for human consumption or to produce wool, and sold in bulk quantities or bags of 20 kg or more
  • feed sold in bulk quantities or bags of 20 kg or more and designed for ostriches, rheas, emus, or bees
  • food processing by-products sold in bulk quantities or bags of 20 kg or more and used as feed or as ingredients in feed for farm livestock, fish, or poultry that is ordinarily raised or kept for human consumption or to produce wool, or for rabbits, ostriches, rheas, emus, or bees
  • pesticides used for agricultural purposes labelled by the Pest Control Products Regulations and not designed for domestic use
  • sales of quotas between farmers for zero-rated products (including dairy, turkey, chicken, eggs, and tobacco leaves)
  • farmland rented to a registrant under a sharecropping arrangement, where a share of the production that is zero-rated is part of the price (any other extra payments are taxable)

Input tax credits and exempt goods and services

GST/HST registrants can claim an input tax credit for the GST/HST they paid or owe for expenses used to provide taxable goods and services at the rates of 0%, 5%, 13%, 14%, or 15%.

For more information on claiming the input tax credits and the percentage of use in commercial activity, see GST/HST Memorandum 8.1, General Eligibility Rules and GST/HST Memorandum 8.2, General Restrictions and Limitations.

A limited number of goods and services you purchase are exempt from GST/HST. Since you do not pay GST/HST on these goods and services, there is no input tax credit to claim.

Examples of exempt goods and services include:

  • insurance services sold by insurance companies, agents, or brokers
  • most services provided by financial institutions, such as arranging loans or mortgages
  • most health, medical, and dental services

Eligible registrants can file their GST/HST returns online by using GST/HST NETFILE or the “File a return” service at My Business Account. For more information about GST/HST, go to GST/HST.

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