Farming Income and the AgriStability and AgriInvest Programs Harmonized Guide 2021 – Chapter 2 – Your AgriStability and AgriInvest programs

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Participating in the programs

You can choose to participate in AgriStability only, AgriInvest only, or both programs together, depending on the business risk management needs of your farm.

As a program participant, you are responsible for knowing program deadlines and understanding program policies. For more information, see the program handbooks or visit the program websites.

AgriStability

AgriStability is a margin-based program that provides support when you experience larger income losses.

Find out if you are eligible

To participate in AgriStability for the 2021 program year, you must:

In addition, you must have:

We may waive the requirements to complete six consecutive months of farming activity and a production cycle if you experienced a disaster.

If you are a Status Indian farming on a reserve in Canada and you are not required to file an income tax return, contact your Administration for a copy of the form and guide you need to complete.

For more information on eligibility, see your program handbook or visit the program websites.

How to participate

Complete and send pages 1 to 7 of your Form T1273 by the deadline. For information on program deadlines, see Dates to remember.

AgriStability benefit calculations

AgriStability is based on margins.

Program margin – your allowable income minus your allowable expenses in the current year adjusted for changes in purchased inputs, receivables, payables, and inventory.

Reference margin – an average of your program margins for the past five years with adjustments made to reflect significant changes to the size or structure of your farm. We drop the highest and lowest years and average the remaining years.

Generally, you will receive an AgriStability payment when your program margin in the current year falls more than 30% below your reference margin. AgriStability covers 70% of your decline that is beyond the 30%.

Reference margins will be calculated for 2021 as follows:

For more information on margins and how we calculate AgriStability payments, see your program handbook or visit the program website.

We will send you a Calculation of Program Benefits after we process your form, to show you how we calculated your benefit.

AgriStability program fee

You must pay an annual fee to participate in AgriStability. The fee is $3.15 for every $1,000 of contribution reference margin protected (based on coverage of 70% of your margin). The minimum fee is $45.

For more information on program fees and participation rules, see your Enrolment Notice or your program handbook.

AgriStability administrative cost share (ACS)

You must pay $55 each year for administration costs.

To participate in AgriStability, you must pay your fee and ACS by the deadline. You can:

For more information, contact your Administration.

Note

The electronic payment is not available for producers in British Columbia.

Do not send payments for the AgriStability or AgriInvest programs with your income tax return. The CRA will credit any payments you include with your income tax return to your income tax account.

AgriInvest

AgriInvest is a self-managed producer-government savings account designed to help you manage small income declines and make investments to manage risk and improve market income.

Each year you can deposit money into an AgriInvest account and receive matching government contributions. You can withdraw the money when you need it.

Find out if you are eligible

To participate in AgriInvest for the 2021 program year, you must:

If you are a Status Indian farming on a reserve in Canada and you are not required to file an income tax return, contact your Administration for a copy of the form and guide you need to complete.

For more information on eligibility, see the AgriInvest Program Handbook or go to AgriInvest – Step 1. What this program offers.

How to participate

Complete and send pages 1 to 5 of your Form T1273 by the deadline. For information on program deadlines, see Dates to remember.

AgriInvest benefit calculations

AgriInvest deposits are based on a percentage of your allowable net sales. Allowable net sales are your total allowable commodity sales and program payments minus your total allowable commodity purchases and repayment of program benefits.

Once we process your form, we will send you a Deposit Notice showing your deposit options.

Form T1273, Statement A – Harmonized AgriStability and AgriInvest Programs Information and Statement of Farming Activities for Individuals

As a self-employed farmer, you have to give us a statement that accurately shows your farming activities for the year. Use Form T1273 to report your income and expenses for income tax purposes and to report your farming information for AgriStability and AgriInvest. To get this form, go to Forms and publications.

Deceased participant

If a deceased individual had farming income or losses, complete Form T1273 in the name of the deceased individual. Print "Estate" in the name area. Use the income and expenses that you are reporting on the individual's final income tax return for 2021.

Send copies of the individual's death certificate and the probated will (or letters of administration) to the CRA with the final income tax return and to your AgriStability and AgriInvest Administration.

If you also file an optional return for the year of death, such as a return of rights and things, contact your Administration to get the correct form to provide this information to your Administration.

Prepare an additional Form T1273 in the name of the surviving spouse or common-law partner if a beneficiary continues the farming business. Contact your Administration to get the correct form if a trust has been established for the surviving spouse or common-law partner. Use the income and expenses from the surviving spouse's or common-law partner's 2021 income tax return. For more information about applying as a trust, contact your Administration.

Form T1274, Statement B – Harmonized AgriStability and AgriInvest Programs Information and Statement of Farming Activities for Additional Farming Operations

You may have more than one farming operation. For example, you could have a sole proprietorship and be a partner in a partnership. If you have more than one farming operation, complete Form T1273 for one operation and a separate Form T1274 for each additional operation. To get these forms, go to Forms and publications.

Additional expenses (partnerships)

Complete Form T1274 if you have reported a partnership operation on Form T1273 and you want to deduct additional expenses for which the partnership did not reimburse you. For example, you may want to deduct the farming business part of allowable motor vehicle expenses or business-use-of-home expenses.

If you are using Form T1274 to deduct business-use-of-home expenses, follow these steps:

The amount you claim reduces your net income from farming on line 14100 of your income tax return. However, you cannot use business-use-of-home expenses to create or increase a loss from farming.

Note

The instructions in the note in the "Business-use-of-home expenses" section of Form T1175 do not apply if you are only claiming business-use-of-home expenses.

Completing the forms

By completing Form T1273 and Form T1274, you authorize:

The information is used for:

For more information, see "Confidential information and participant consent" on page 2 of Form T1273.

The Privacy Act gives you the right to access your personal information held by the Government of Canada and make any corrections to your information.

If you want to access or correct your personal information, contact the Access to Information and Privacy Coordinator at:

Access to Information and Privacy Office
Agriculture and Agri-Food Canada
1341 Baseline Road
Ottawa ON  K1A 0C5
Telephone: 613-773-0970
Fax: 613-773-1380
Email: aafc.atip-aiprp.aac@canada.ca

For general inquiries on privacy of personal information, contact the Office of the Privacy Commissioner (OPC) at:

Office of the Privacy Commissioner of Canada
30 Victoria Street
Gatineau QC  K1A 1H3
Toll-free telephone: 1-800-282-1376
Telephone: 819-994-5444
TTY: 819-994-6591
Website: priv.gc.ca

If you have a complaint under the Privacy Act, contact the Office of the Privacy Commissioner.

Adjustments

Use Form T1275 to either:

If you farm in Manitoba, Newfoundland and Labrador, Nova Scotia, New Brunswick, or the Yukon, send this form and any attachments to the federal Administration.

If you farm in British Columbia, send this form and any attachments to either:

For adjustments that affect your net income, send Form T1-ADJ, T1 Adjustment Request, to the CRA.

The following text explains how to complete Form T1273.

Participant information

Participant identification

Enter your first and last name.

Enter your participant identification number (PIN). You can find your PIN on either your:

If you cannot find your PIN, contact your Administration.

Enter your social insurance number (SIN).

Enter your business number (BN). If you cannot find your BN, contact the CRA.

Enter your telephone and fax numbers (if applicable).

Enter your email address (if applicable).

Farming information

Province/Territory of main farmstead

Enter the province or territory where you earned most or all of your gross farming income over the previous five years.

For more information on province of main farmstead and multi-jurisdiction farms, contact your Administration or visit the program websites.

Number of years farmed

Enter the number of years you have farmed.

Final year of farming

Answer "Yes" if 2021 was your final year of farming.

Industry code

Enter the industry code that best describes your activity.

If more than 50% of your business involved one specific activity, choose the code that identifies that main activity. However, if your business is involved in more than one type of economic activity, and none of the codes make up more than 50% of your business, choose the appropriate level of code from the list.

When you are filing your return electronically, you have to use the industry codes available from your tax preparation software.

The industry codes listed in this guide are from the latest version of the North American Industry Classification System (NAICS) Canada.

There are thousands of NAICS codes. The following are examples of codes for farming operations.

Livestock farm
Other animal specialties farm
Field-crop farm

Production cycle

Answer "Yes" or "No" to show if you have completed a production cycle on at least one of the commodities you produced.

You must have completed a production cycle to be eligible for AgriStability. We may waive this condition if you experienced a disaster.

A production cycle includes at least one of the following:

You do not need to complete a production cycle to be eligible for AgriInvest.

Contact person information

Fill in this area if you give permission to someone else (such as your spouse, common-law partner, or accountant) to provide or ask for more information about your AgriStability and AgriInvest form. We will call your contact person if we have a question. We will send correspondence to both you and your contact person.

Your contact person can:

Your contact person cannot:

Tick the box if you have a contact person.

Enter the first and last name of your contact person, their business name (if applicable), address, and telephone and fax numbers.

Answer "Yes" if you want a copy of your Calculation of Program Benefits mailed to your contact person.

If you leave this area blank, we will contact you directly if we have a question.

Federal public office holder or employee of Agriculture and Agri-Food Canada (AAFC)

If you or anyone involved in completing this form is a current or former federal public office holder or employee of AAFC, answer "Yes" to this question. If you are a partner in a partnership and at least one of your partners is a current or former federal public office holder or employee of AAFC, answer "Yes".

Other farming information

Location of main farmstead

See the list of provincial jurisdictions (for example, rural municipalities, counties, districts) in the Regional code list.

You do not have to fill in this section if you farm in Newfoundland and Labrador.

Combined operations

AgriStability is a whole farm program. That means we may combine your farm with another farm even if the operations report separately for income tax.

Combining ensures that AgriStability benefits are paid to farms that had decreases in income for reasons beyond their control, not because of business or tax planning decisions.

Generally, you should answer "Yes" to this question if one of the following applies:

Individuals in a partnership do not need to be combined.

If your farm has a change in combined operations, enter the operation PIN and tick "Add" or "Remove."

For more information on combining, see your program handbook or visit the program website.

Note

We need the information from all the combined farms before we can process your form.

Identification

In the following sections of the form, only provide information about your main farming operation (Operation #1). Complete Form T1274 for each additional farming operation you have. Number each operation in the box at the top right-hand corner of each page.

Tick the "Sole proprietorship" or "Partnership" box.

Fiscal period

Enter the fiscal period for your operation. Report the beginning and end of the farm's business year by the year, month, and day. Your farm's 2021 fiscal period must end in the 2021 tax year.

Method of accounting

Use the same method of reporting (cash or accrual) for program purposes as you use for income tax. Enter either:

If your farm was involved in any of the following

Tick the applicable box(es) if your farm was:

For your main farming operation (Operation #1), enter this information on Form T1273. For your other operations, enter this information on Form T1274.

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