lion’s club hall april 1st, 2015 18h00 to 21h00 rsvp: victor brunette office 819-827-0338...
TRANSCRIPT
Lion’s Club Hall
April 1st, 2015
18h00 to 21h00
RSVP: Victor Brunette
Office 819-827-0338
Tax Training Session
Agence des forêts privées de l’Outaouais
Property Tax Reimbursement Program 2014 Victor Brunette, ing.f.
*Session Plan
* Woodlot Owner Status
* Property Tax Reimbursement Program
* Revenues and Expenses
* Capital Gains Deductions
* Inter-generational transfer
* Forest Operations Tax
Fiscal Status of a woodlot owner
Canada Revenue Agency
*Interprétation bulletin IT 373 R2
Définition:
*A woodlot is a parcel of land covered with trees…
* Those trees grow with … or without human intervention….
Fiscal Status of a woodlot owner
It could be * A commercial woodlot ?
* A non-commercial woodlot ?
* A farm woodlot ?
Fiscal Status of a woodlot owner
A commercial woodlot is in continuous operatioin
* existing and recognized business
* Ongoing operation of a business
Fiscal Status of a woodlot owner
Existing business
In the definition of a business, the law means a commerce, a profession, a trade, an operation, an industry or another activity related forests and forestry.
Fiscal Status of a woodlot owner
Defining a business: A business requires time, money and work The time needed to bring a business within a reasonable expectation of profit varies
A business has a legal status
Fiscal Status of a woodlot owner
*Reasonable expectation of profit (REP)
Most important
Fiscal Status of a woodlot owner
Criteria for determining REP Importance of business plan Efforts invested Time invested Financial capital invested History of profits and losses Forest knowledge and competency
Fiscal Status of a woodlot owner
Expected activities*Silviculture operations
*Plantations
*Wood Harvesting
* Thinnings
Fiscal Status of a woodlot owner
If it is a commercial woodlot:
* All expenses to generate revenue are deductible
* Commercial losses are 100% deductible
Fiscal Status of a woodlot owner
If one does not « operate » the woodlot,
then it is non-commercial
* It is a personal asset
* No expense whatsoever is deductible
Fiscal Status of a woodlot owner
A farm woodlot is a woodlot in operation
* Farm woodlot activities are those accepted by Revenue Canada and Revenue Quebec as corresponding to agricultural activities
Fiscal Status of a woodlot owner
Why agriculture ?* Fiscal law recognizes agriculture as a definite sector
* Agriculture has particular rules and regulations
* Capital gains deductions
* Family transfer tax free
* Accounting method (cash vs calendar year)
Fiscal Status of a woodlot owner
Defining agriculture:
* The culture of soil
* Upkeep of farm animals
* Beekeeping
* Gardening and horticulture
* Silviculture (Bulletin IT 373 R2 par. 14)
* Christmas trees, maple syrup…
Fiscal Status of a woodlot owner
* Which is not a tax reimbursement program …. Dixit me.
*It is rather a reimbursable provincial income tax credit on sylviculture and other accepted woodlot investments ………….to a maximum of 85% of the property and school taxes paid.
Property Tax Reimbursement Program
Paperwork* Professional forester’s report
* Provincial Income Tax Return *Annex E, part C
*Follow up on residual claims …… paper track
Property Tax Reimbursement Program
(FAQ) Frequently Asked Questions
Q1: Eligibility……..One tax account ?
Yes for one tax account… Yes for many tax accounts ….Yes for both municipal property tax, land transfer tax (welcome tax) and yes for school tax. For each property unit for which you claim the tax program…. You need an active woodlot owner status, a lot registration on the status and an active woodlot management plan ….. For one day of the year
Property Tax Reimbursement Program
FAQ 2
How and when you claim on your annual tax revenue?
I claim the 2013 expenses on my 2013 tax declaration which I file in 2014 and I receive a reimbursable credit in 2014 and I declare this reimbursement as a revenue in 2014.
I claim the 2014 expenses on my 2014 tax declaration which I file in 2015 and I receive a reimbursable credit in 2015 and I declare this reimbursement as a revenue in 2015.
Property Tax Reimbursement Program
FAQ 3 and 4
* Q3 Q4: What astérisks mean *****
* Possibility to use the receipt rather than the determined rate……with conditions…..
* Example: Rate = 1200$ ou Rate 1200$****
Receipt = 1000…..Claim 1200$
* Receipt = 1600$ ….. Claim 1600$
* Receipt = 3000$..... Calim 2400$
Property Tax Reimbursement Program
FAQ 5
* Include GST et la PST ?
* Use the rate in the annex … the reate is the rate
* If you use the receipt… you can use the total amount
* ….Except if you are a buseness which already claims the GST and PST…. Registered to tax status…
* No double dipping !!!!
Property Tax Reimbursement Program
FQA 6
* Q6: Claims transferable to new owner ?
* No….No but once a claim is file, the residual can be claimed on other properties for as long as your woodlot owner status is active.
Property Tax Reimbursement Program
FAQ7: Requirements
* Status Woodlot Owner
* Registration of forest lots with active management plan on status registration
*Municipal property and school tax receipts
*Accepted forest activities $$ = or > tax $$ (producer himself or contracted work)
* Professional forester’s report
*No Double Dipping … PRTF ou PMVFP or farm tax credit program
Property Tax Reimbursement Program
* FAQ8: May I benefit from PRTF and PMVFP ?
* Yes ……Complementarity….but….
* One has to separate technical services cost and operations cost
* No Double dipping !!!!
Property Tax Reimbursement Program
* FAQ8: Complementarity
Property Tax Reimbursement Program
Possibilities PMVFP PRTF
Rate Rate Règlement PRTF
Technique Exécution Technique Exécution
1 x x2 x x3 x x4 x x
* FAQ8: PRTF or PMVFP road building receipt 1500$
Property Tax Reimbursement Program
Possibilities PMVFP PRTF
Taux Agence Taux Règlement PRTF
technical operational technical operational
1 500 1837*2 1000 788*3 788* 1837*4 500 1000
* FAQ8: PRTF or PMVFP roadbuilding receipt 4000$
Property Tax Reimbursement Program
Possibilities PMVFP PRTF
Rate Agence Rate PRTF
Technical Operational Technical OperaTIONAL
1 500 36742 1000 15763 1576 36744 500 1000
* FAQ8: PRTF or PMVFP culvert receipt 600$
Property Tax Reimbursement Program
Possibilities PMVFP PRTF
Rate Rate PRTF
Technical Operational Technical Operational
1 100 1029*2 300 441*3 441* 1029*4 100 300
* FAQ8: PRTF PMVFP culvert receipt 4000$
Property Tax Reimbursement Program
Possibilités PMVFP PRTF
Rate Agence Rate PRTF
Technique Exécution Technique Exécution
1 100 20582 300 8823 882 20584 100 300
* FAQ10: Silviculture work on one evaluatiuon unit and claim on another evaluatiuon unit ?
* Yes…. As long as it is the one landowner
Property Tax Reimbursement Program
Q11
* FAQ12/ FAQ13 : Claim calculation PRTF?
* Expenses Investment < taxes*Save them and use them cumulatively
* 5 years (subsequent to investment)
* Expenses Investment > taxes*Admissible for reimbursement
* 10 years (subsequent to investment)
Property Tax Reimbursement Program
FAQ 15: If I do not have income tax to pay !
* The reimbursement of PRTF is a reimbursable tax credit …. whether you owe tax or not!!!!
Property Tax Reimbursement Program
FAQ 16: Can I do the work myself?
*Yes….but…
*If you have a woodlot management convention… contract… talk to your accredited forester. Verify with your professional forester.
Property Tax Reimbursement Program
Victor Brunette, professonal forest ingineer
Agence des forêts privées de l’Outaouais
Questions?