In some scenarios, property owners may be exempt from an eligibility requirement of the Farm Property Class Tax Rate Program. A property owner may be exempt from the $7,000 minimum annual income requirement. There is also a Farm Business Registration (FBR) religious exemption through the FBR program.
To apply for an income exemption, make sure you meet the criteria for the type you are applying for and
complete the Eligibility Application. You must complete all sections accurately for faster processing and no delays in assessing your exemption request.
Important: After you submit your application, Agricorp will contact you about the outcome and tell you when your exemption expires. You must contact Agricorp before the exemption expires to remain in the Farm Property Class Tax Rate Program.
The following Farm Property Class Tax Rate Program exemptions are available:
| Eligibility requirements | Exemptions available |
|---|
| FBR religious exemption | Farm Property Class Tax Rate Program gross farm income exemption |
|---|
| MPAC has assessed your property as farmland. | No exemptions |
| Your property is used for farming business. | No exemptions
| ✔ |
| The farm business on your property has a valid FBR number. | ✔ | ✔ |
| The property is owned by Canadian citizens or permanent residents. | No exemptions |
FBR religious exemptions
If religious beliefs cause you to disagree with registering your farm business or making the registration payment, you may qualify for an exemption from Farm Business Registration (FBR). Contact the Agriculture, Food and Rural Affairs Appeal Tribunal (AFRAAT) at 519‑826‑3433 or 1‑877‑424‑1300. You must still meet the $7,000 annual gross farm income requirement. Once you receive your AFRAAT exemption letter, you can complete your eligibility application. Remember to include a copy of the letter in your eligibility application. The FBR religious exemption lasts as long as you hold your religious beliefs.
Income exemptions
If your annual gross farming income was less than $7,000 in the previous income tax year, you may be eligible to apply for one of the available income exemptions. If you receive a gross farming income exemption, you are also exempt from the FBR requirement for that year. Income exemptions expire after a specified period of time of no longer than 3 years. The timeline for expiry is communicated with approval of an exemption.
Start-up farm businesses
The income exemption for start-up farm businesses is for new farm businesses that have not yet earned $7,000 in annual gross farming income.
To be eligible, you or your tenant must meet the following criteria:
- You have started or plan to start a new farm business that will enter the market for the first time and generate a farm income as defined by the Canada Revenue Agency.
- Your farm business has not generated more than $7,000 in a previous income tax year.
- You have filed (or will file) income taxes for your farm business and can provide documentation to validate farm income and expenses.
- You can demonstrate how the farm business will generate at least $7,000 annually in future years.
If your income exemption for a start-up farm business is nearing expiry and your business has not yet earned $7,000 of gross farming income, you may submit a new eligibility application for a new exemption. You will need to list your proposed sources of income in the eligibility application.
Business structure change
The income exemption for business structure changes is for businesses that have restructured to or from a sole proprietorship, corporation or partnership, resulting in the gross annual farming income being less than $7,000. You will need to explain on the eligibility application when you expect the farm business to reach $7,000 annually.
Not a normal production year
The "not a normal production year" income exemption is for businesses whose gross farming income for the previous income tax year was less than $7,000 due to unusual circumstances, such as extreme weather or market changes, that could not have been prevented with best management practices. You or your tenant will need to explain on the eligibility application why your gross farming income was less than $7,000 and when you expect to reach $7,000 annually.
Age, illness or death of spouse
The income exemption for age, illness or death of a spouse is for property owners only. Thegross farming income in the previous income tax year must have been greater than zero and less than $7,000 due to the age, illness or injury of the owner or their spouse, or the death of the owner's spouse. You will need to explain on the eligibility application why your annual gross farming income was less than $7,000 and when you expect to reach $7,000 annually.
To be eligible for this exemption, you must meet the following criteria:
- You or your spouse must own the property and operate the farm business.
- During the previous 10 years, you farmed the property yourself (i.e., a tenant was not farming) and you received the farm property class tax rate.
- The farm business reported a gross farming income greater than zero in the previous income tax year.
