Agricorp presents ... AgriStability Video Shorts
Understanding elements of the program
This video short focuses on...
The tax-aligned reference margin option
Hi. I’m Jeff Janssen
I’m a Senior Program & Policy Specialist at Agricorp, with a focus on AgriStability
I’ve been involved with the program, in some form or another, for the last 15 years
Thank you for tuning in today.
I’m excited to share an AgriStability update with you today – one that brings good news
New in 2025, the government introduced a new option for participating in AgriStability.
It’s called the tax-aligned reference margin.
This new option makes it easier to participate in AgriStability by aligning your reference margin with your tax data.
What does this mean for you?
It means 3 things.
- You’ll have better predictability
- You’ll have less information to collect and submit
- And you’ll have less paperwork if you don’t have a claim
But... before I explain the details, I’d like to give you a quick summary of what a reference margin is. This might also help if you’re new to AgriStability....
Your reference margin is essentially your average net income
And It’s based on your 5 most recent years, with the low and high values removed.
Then we take an average of the remaining numbers
If you’re new to AgriStability, we may use your last 3 years
To learn more about AgriStability margins, check out the video shorts on our website
Now let’s get back to the benefits of having a tax-aligned reference margin
The first benefit is better predictability
With this new option, Agricorp will send you a Coverage Notice Estimate in the fall of each program year
The coverage notice estimate has 2 key pieces of information that will help you better understand your AgriStability claim position.
The first is your estimated reference margin. This tells you your estimated average net income, based on the tax information you filed.
The second is your estimated payment trigger. This tells you the level of net income loss that would trigger a payment.
With this information, you’ll know your claim position sooner, giving you better predictability
Let’s move on to the second benefit of having less information to collect and submit
If you choose the tax-aligned reference margin, Agricorp will use the historical income and expenses you file for taxes to calculate your estimated Reference Margin
So what’s the benefit of that?
It means your AgriStability numbers will match the accounting method you use for taxes
Which in turn, means you will have less information to collect and submit for AgriStability.
To dig into this a little deeper it means:
If you use a cash method of accounting for taxes, you’ll no longer have AgriStability adjustments made to account for things like
- Crop and livestock inventory
- Purchased inputs, and
- Accounts receivable and accounts payable
If you use an accrual method of accounting for taxes, you‘ll no longer have a breeding herd adjustment applied to your Reference Margin
The third benefit of the tax-aligned reference margin option is less paperwork if you don’t have a claim
If you predict that you won’t be in a claim position, you won’t need to submit the AgriStability year-end claim form.
So what questions might you ask yourself when predicting your claim position?
Keep in mind that AgriStability is intended to cover large declines in net income cause by production loss, increased costs, and market conditions.
You should ask yourself:
- Will my farm’s net income be lower than my payment trigger?
- Did my farm have production or market losses throughout the year?
- Did my farm have losses that affected the whole farm operation?
- Did my farm have a significant increase in costs affecting my net income?
- Does my farm have accruals (like inventory adjustments) that could affect my net income?
If you answer “no” to these questions, you may not be in a payment position.
And you can choose not to file your year-end claim paperwork – saving you time and money!
You can also check the AgriStability Quick Estimator tool on Agriculture and Agri-Food Canada’s website to predict your claim position.
The Quick Estimator is an easy 1-page calculator. Simply enter your information to get an estimated payment amount.
Search for the AgriStability Quick Estimator online to find it.
So, you may be wondering what happens if you do predict your net income to be close to or under the payment trigger in your …?
If your farm business is in this difficult situation, it would be in your best interest to file the year-end claim form by June 30 of the following program year.
If you are in this situation, you can also consider applying for an interim payment, which is an advance on your final estimated payment.
This will start your claim process, as usual.
To take advantage of this easier way to participate in AgriStability
- Go to Agricorp.com.
- Click the card on the homepage
Complete the digital Selection Form and email it to us.
It won’t take you more than 5 minutes to get better predictability and less paperwork if you don’t have a claim.
So that’s what the tax-aligned reference margin is all about.
Thank you for joining me today.
