The Government of Canada released the final list of designated regions where Livestock Tax Deferral has been authorized for 2019 due to extreme weather conditions. The initial list of designated regions – which was announced on July 22, 2019 – included British Columbia, Alberta, Saskatchewan, Manitoba and Quebec. Ongoing analysis of drought conditions throughout the remainder of 2019 identified new regions for British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec.
The Livestock Tax Deferral provision allows livestock producers in prescribed drought, flood or excess moisture regions to defer a portion of their 2019 sale proceeds of breeding livestock until 2020 to help replenish the herd. The cost of replacing the animals in 2020 will offset the deferred income, thereby reducing the tax burden associated with the original sale.
Eligibility for the tax deferral is limited to those producers located inside the prescribed areas. Producers in those regions can request the tax deferral when filing their 2019 income tax returns.
For additional information regarding the Livestock Tax Deferral provision, visit the Agriculture and Agri-Food Canada website or contact your Baker Tilly advisor.
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