In some scenarios, property owners may be exempt from an eligibility requirement of the Farm Property Class Tax Rate Program, also known as the "Farm Tax 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,
download a form. A written decision on the outcome of the application will be sent to all applicants by mail or email. The written notice will state when your exemption expires. You must contact Agricorp before the exemption expires to remain in the Farm Tax Program.
The following Farm Tax Program exemptions are available:
|Eligibility requirements||Exemptions available|
|FBR religious exemption||Farm Tax Program gross farm income exemption|
|MPAC has assessed your property as farmland.|
|Your property is used for farming business.||
|The farm business on your property has a valid FBR number.||
|The property is owned by Canadian citizens or permanent residents.|
FBR religious exemptions
If you object to participating in the FBR program or to paying the FBR annual invoice due to religious beliefs, you may request an exemption. Contact the
Agriculture, Food and Rural Affairs Appeal Tribunal (AFRAAT) at 1-888-466-2372, ext. 519-826-3433. You must still meet the $7,000 annual gross farm income requirement.
Types of FBR religious exemptions
FBR religious (payment only)
If you object to paying the FBR annual invoice due to religious reasons, you may apply for this exemption, which must be renewed every 10 years. To maintain Farm Tax Program eligibility, once you receive your AFRAAT exemption letter, send a copy of this letter to Agricorp with your property roll numbers. You must still obtain an FBR number.
FBR religious (registration and payment)
If you object to registering for FBR and to paying the annual invoice due to religious reasons, you may apply for this exemption, which lasts as long as you hold your religious beliefs. Once you receive your AFRAAT exemption letter, send a copy of this letter to Agricorp with your property roll numbers.
If the 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 farm income exemption, you are also exempt from the FBR requirement for that year. When you receive your Farm Tax Program confirmation of approval form from Agricorp, it will note when your exemption expires. To remain eligible for the Farm Tax Program, you must contact Agricorp before your exemption expires.
Types of income exemptions
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 application for a new exemption. You will need to explain why your farm business did not meet your previous gross farm income projections and how you plan to earn the required farming income.
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 farm income being less than $7,000.
Not a normal production year
The "not a normal production year" income exemption is for businesses whose gross farm 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 demonstrate why your gross farm income was less than $7,000 and how the farm business will generate at least $7,000 annually.
Age, illness or death of spouse
The income exemption for age, illness or death of a spouse is for –property owners whose gross farm income in the previous income tax year was 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. 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.
- The property(ies) must have received the farm property class tax rate for the previous 10 years.
- The farm business reported a gross farm income greater than zero in the previous income tax year.