Bill C-208, a private member’s bill spearheaded by western Manitoba Conservative MP Larry Maguire with amendments to the federal Income Tax Act, cleared the House of Commons in mid-May and Senate in late June. On June 29, it got royal assent.

However, the federal finance department on June 30 pointed out that C-208 as passed “does not include an application date.”

The Liberal-led government said June 30 it’s “committed to facilitating genuine intergenerational share transfers, while preventing tax avoidance that undermines the equity of Canada’s tax system.”

Thus, the government said, it proposes to introduce separate legislation to “clarify” that C-208’s amendments apply at the beginning of the next tax year, starting Jan. 1, 2022.

C-208’s tax law amendments are meant to exclude the sales of farms and other small businesses to adult children or grandchildren from current anti-avoidance rules.

Under pre-C-208 tax law, Maguire said in May, “when a person sells their small business or farm to a family member, the difference between the sale price and the original purchase price is considered a dividend.”

But if the business instead goes to a non-family member, the sale is deemed a capital gain, which is taxed at a lower rate and allows sellers to use their lifetime capital gains exemption, he said.

During debate on C-208 last fall, the Liberals cautioned that Maguire’s bill, as Ontario MP Tony Van Bynen put it, “seeks to amend two of the Income Tax Act’s most important and complex anti-avoidance rules.”

Those rules, he said, are meant to apply when an individual sells shares of a corporation to another corporation that is linked to the same individual — for example, through a family member.

When shares of a Canadian corporation are sold to such a “linked” corporation, the pre-C-208 rules deem that in certain circumstances, the seller has received a taxable dividend from the linked corporation, rather than a capital gain.

The rule, he said, is meant to ensure taxpayers “cannot use linked corporations to, in effect, remove earnings from their corporations, using a sale as a basis to do so.”

But the Conservatives at the time noted C-208 requires that a family member buying such shares of a farm or small business must not sell them for at least 60 months for any reason, other than “by reason of death.”

To curb tax evasion, they said, C-208’s provisions would not apply to such a buyer who sells before that five-year period ends.

‘Intentions clear’

The Canadian Federation of Agriculture, in a separate statement Friday, took the finance department’s June 30 announcement to mean the government “will likely be making amendments in order to close potential tax loopholes.”

The CFA said its “primary concern” is that C-208’s changes to the treatment of intergenerational farm transfers “must be made clearly accessible as quickly as possible, as Parliament made its intentions clear through the passage of the bill.”

“In our talks with the accounting community, this delay, and the uncertainty around exactly what the amendments will be, will force many farmers who were looking to transfer their farm to a family member to delay their retirement plans until 2022,” CFA president Mary Robinson said Friday.

“If they transfer to a family member under the current rules, it can potentially cost them hundreds of thousands of dollars more in taxes compared to if this bill was fulfilled.”

C-208, Robinson said, would help “preserve the identity and financial stability of the Canadian family farm.”

The Western Canadian Wheat Growers, meanwhile, said they were “dismayed” to hear of the delay. “Canadians need to understand that this current government is not looking out for the best interest of Canadian family farms,” president Gunter Jochum said Monday in a release.

Federal Conservative leader Erin O’Toole also criticized the Trudeau government in a separate statement Friday for “refusing to implement a tax reduction for small business that was passed in Parliament.” –– Glacier FarmMedia Network

The post New rule on farm transfer tax treatment put off to 2022 appeared first on Alberta Farmer Express.

This is a factual case study of succession gone wrong — and the hurt and hardship it created for the families on three farms.

The farms and farm families are extraordinarily similar. The families are well-known and respected leaders in the community. The fathers are revered men who were hard-working and dominate in their homes. The mothers live in servitude and all the now-adult children who still live in the community are capable of running a farm.

Growing up, the children committed equally to the farming enterprise and the farms grew to be of significance. During the years of growth when the children were deciding on career paths, the farms were not considered for sale nor was there any indication of the parents opting out.

Communication in regards to succession was completely absent and any attempt for discussion was not welcomed by the parents. There was an assumption by the siblings that at some point the estate would be divided equally. They all contributed and gave their younger career years to the success of the parents’ farm.

And then it happened.

On all three farms, the parents transferred the entire farm, including all capital and non-capital assets to one child. They also signed over insurance policies and cash and became renters of their own home. There was no precluding discussion and to this day, the parents will not discuss the transfer. There is not any indication of residue in the estate for the siblings.

One family is angry, broken and does not communicate. This family is seriously divided and the siblings no longer are ever in the same room nor do they go back to visit the parents. The only time they are together is in court.

The siblings in the second family remain in shocked and shamed silence, and the siblings in the third suffered deep humiliation, loss and severe depression.

Irreversible intergenerational damage was imposed by all sets of parents. The one set of siblings are firm that they are forever divided. The second set of siblings is quiet in their humiliation. The third family farm was lost under the care of the recipient.

In these families, the siblings have expressed anger, hurt, humiliation, embarrassment, depression, sorrow, pain and sadness. While recognizing the parents had the right to do as they chose with their assets, they feel very confused with the secrecy and they feel less worthy as children. In all three families, the remaining siblings found out by accident and after the fact. They shared that they no longer fully trust the parents, particularly the dominating father. The parents have yet to discuss their decision.

The siblings in family one are determined to fight. They are asking for a piece of the family farm in cash, however small. Their hurt is visible and raw. The second set of siblings has repressed their feelings and continues to work and play together. There is no farm left to fight for in the third family and everyone has lost their home.

Most succession messes gravitate around love, land, power or money: which one of these do you think exemplifies this case study of three farms?

Was one child loved more than the others in each family unit? Was this a power trip — an exchange that sends a strong message to daughters and also to younger sons? Elder abuse is a consideration. Was there manipulation by the recipient adult child? Was this a desperate attempt to leave land in the family? Is this about cowardice or lack of information? Was this parental power over the recipient child to get the desired heir thus avoiding discussion on family equity?

Ironically, the secret transaction of the farm to one child without consideration of the others failed.

One farm is gone and in the other two, neither recipient adult, now both of retirement age, will discuss succession with their children nor are those third-generation children interested in farming. The behaviour of the parents has become intergenerational, perhaps because the adult who was secretly gifted the farm has not experienced emotional and economical harm.

What do we learn from this succession story?

Children are persons. Having a child or adopting a child comes with a responsibility focused on love and equitable treatment at all times. Parents should recognize the gifts each child brings into their lives and strive for the excellence of everyone in the family, regardless of gender. It is important to recognize the contribution of children to the farm through financial planning and award shares or dividends.

And parents, must at all times — regardless of how difficult the dynamic — be transparent, fair, realistic and talk about the plans for the future. At some point, this is a taxable transaction and it may be the surviving spouse or siblings paying that bill. If stakeholders are unsure, good advice is available.

The runway for succession is long and complicated. Gifting or transferring the entire estate or all the current equity to one child without discussion and recognition of the others is not a reasonable option.

The post Schoepp: When it comes to succession, things can so easily go terribly wrong appeared first on Alberta Farmer Express.

Later that week I coaxed an elderly man holding his electric saw down off a 25-foot extension ladder. At a lavender farm, I encouraged the owner to stop giving city children rides in the tractor loader.

These were mistakes and pranks that could have cost lives.

The farm is already a busy place. As activity escalates, especially at harvest time, we often do things in the interest of time. That rush to the field, pen or processing floor could be deadly for ourselves or someone we love.

I was raised in a go-go-go environment. There were a lot of accidents. We worked hard, and equipment and bodies broke down from fatigue. During those busy times I often marvelled at the family playing softball on a Sunday during harvest who by the end of the season had still finished more acres in less time.

There is a lesson in that observation. Time is important. While many farm families such as ours were saving time in the doing — the other farm family was banking it.

Time together

Likely at no other period in recent history has the need to be together been so strong. Families are grieving and wanting to see mom and dad, brothers and sisters, sons and daughters, grandchildren and friends. Many may be thinking: I wish we had spent more time together or I wish I could hug mom just one more time. I know I do.

As harvest looms, the shortage of help, the slowing of the supply chain creating deficiencies in almost everything from parts to pop, and the infliction of dramatic weather all contribute to a sense of urgency. A need to ‘get things done’ in haste blinds farm families to the value of taking time to prepare.

Although the sense of urgency is understandable, it can be costly and preparedness is critical.

There may be, in the middle of harvest, a lockdown or a shortage of things deemed essential to getting the job done.

If you were to write down all that you must have to successfully harvest, what does that list look like? Does it include key people, time to rest, extra food, parts and fuel, a contingency plan if a person becomes ill, servicing all equipment thoroughly ahead of time, a planned surprise gift or event for the staff at the conclusion of reaping or the backup of medical or mental health consultations? Will there be time, joyfully given, for staff and family to walk away from the field if a family member has a short window to drop in or a senior is allowed family visits?

And what of those little humans who bring us such joy? What is the plan for their comfort, safety and need for interaction? Ensuring that we carve out time to play, even during harvest, keeps balance in the child’s life and in ours. This is banking time.

Banking time is like fuelling the reserve tank. Not only have we created special memories and left our family and staff feeling valued, but we also then have a little extra alertness to give our work. This too saves lives.

A fatigued body can misfire. It could be not seeing the child zip out in front of the truck, getting too close to the edge of the ditch or forgetting to shut equipment off. A misfire could include simple things like missing a meal or ignoring that grinding sound. A fuelled mind and body appreciates the importance of banking time together and alone.

Time alone

Time alone to sort out our day and our priorities is equally important for men and women. Everyone needs a break and that day off when time is being banked might look like a split shift. The one in the field, be that mom or dad, might find a raft of youngsters cast upon them for a short period as the individual running the command centre seeks reprieve. Be flexible.

Most important is the alone time for introspection and observation. Answering the introspective question of: How am I doing? And the observational question of: What is going on?

How you are doing is really a deep dive into your needs to keep going. What is going on is a deep dive into the interplay of all that is happening. Both need time, your time at harvest to ensure the health and safety of all.

Time is our most valuable currency. We can fool ourselves into thinking that the world ends because of a softball game on a Sunday, but that is not true.

What is true is that in Canada the majority of farm fatalities for men and women and boys and girls are rollovers, entanglement and suffocation. For those very old and very young, there is the added risk of being run over. Safety equipment is critical but so is common sense, training and education, appreciative leadership, respect, preparedness, good food, play and banked time. This we can do.

The post This harvest, take a bit of time to do things differently appeared first on Alberta Farmer Express.

“What are we afraid of?” asked Chan, speaking at the annual Dairy Farmers of Manitoba conference in Winnipeg. “Why don’t people speak up when someone in your family or a friend says something wrong about agriculture?”

No one wants a family gathering to dissolve into a shouting match over animal welfare or biotechnology, Chan said, but she stressed that, at the end of the day, speaking louder isn’t going to change anyone’s mind.

“You want to meet these consumers where they stand, we don’t want to get up on our soapbox,” she said.

Too often, producers fall into the mindset that if they can just hammer home enough facts or if they can just convince a consumer to think like they do, all their problems will disappear, Chan said.

Not so, according to the senior manager of veterinary services at Zoetis.

“Take a step back and ask them what their concerns are,” she said. “When they raise these issues and instead of going straight into educating them about what it is that actually happens… pause for a moment.”

Asking follow-up questions about why they are concerned and where they got their information from is also important, said Chan, adding if producers listen and understand consumer concerns they’ll be able to move forward constructively.

“Get them to expand,” she said. “Just say, ‘Hmm, that’s interesting, I certainly don’t want antibiotics in my food either; what is it that worries you?’ ”

Once common ground is established, farmers can begin introducing the information they want consumers to hear.

“That next piece is we talk about a safe and wholesome product,” she said, adding the vast array of choice in grocery story does beg certain questions — questions to which consumers don’t often have reliable answers.

For example, with some products labeled as “antibiotic free,” consumers are left wondering if other products have antibiotics in them, or are unclear on how products are produced, Chan said.

“The inference is that maybe there are products that have antibiotics in it, so should I be worried?”

But slamming organic products or denigrating certain production methods isn’t helpful either. Instead, Chan said producers should talk about how they do things on their own operations, the care and attention they give to animals and explain what labels represent in terms of on-farm practices.

“We are all in this together,” she said.

Sharing the kind of research being done on animal welfare is also an important way to demonstrate the level of care provided. She referenced current dairy research that looks at neuroplasticity in calves as an example of the lengths researchers go to increase cow comfort.

“So these are things that we’re engaging in on the dairy side that really make me proud to be doing what we are doing,” Chan said. “I don’t think people understand how important it is to us that we are producing a safe and nutritious food product and that means that we have to be caring for our cows and providing them with a good quality of life.”

Producers also can’t expect that consumers will learn about food production and animal care if they stay silent.

“We should be shouting that from the rooftops and if we’re not comfortable doing that, we definitely need to be supporting those who are,” Chan said. “Because we need to be engaged and we need to make sure we are a part of that story.”

— Shannon VanRaes is a reporter for the Manitoba Co-operator and Country Guide in Winnipeg. Follow her at @ShannonVanRaes on Twitter.

The post Talk to family, friends about farming appeared first on Alberta Farmer Express.

And those lessons have been learned working alongside her farmer father.

“On the outside, I may look like a regular high school girl,” said De Groot, a 4-H speech contest winner from Taber, at the recent Farming Smarter Conference in Medicine Hat.

“But when I put this on,” — she hoisted up a pair of insulated coveralls — “I become a farmer’s daughter.”

Lesson No. 1 is Be prepared.

“When my dad tells me to come out in -30 C weather just to help for a minute, he really means come outside for a few hours and freeze,” she said.

“So get on your stylish insulated coveralls and your muck boots, because this job is never quick.”

And you better not forget the tools, she said, or you’ll be sent straight home to get them.

“Even if I do remember the tool for the job, I may be going back, because there’s two — or even four — more jobs that need completely different tools.”

Lesson No. 2 is Be flexible.

“My dad’s favourite saying is, ‘We’ll see,’” she said. “For Dad, ‘we’ll see’ means you don’t make plans.”

On the other hand, farmers are second to none at making last-minute plans — another lesson in flexibility, she said.

“One year, we booked a trip to Mexico and left two days later.”

Be resilient is lesson No. 3

“Don’t be disappointed when the plans you may or may not have made don’t turn out,” she said, adding that “there may be even better things in store down the road.”

“I’ve learned to accept life’s little disappointments and to realize that, sometimes, things come up that are more important than the old plans.”

Her last lesson is Be dependable.

“I know I can always count on my dad no matter what,” she said.

“Through the good and bad and the changes in plans, I can count on my dad to work hard and get the job done.”

Indeed, being a farmer’s daughter has prepared De Groot well for “the real world.”

“The lessons I’ve learned will serve me well,” she said. “These lessons have made me a person you can count on. Just like my dad.”

The post Four life lessons from the farm that will serve you well in life appeared first on Alberta Farmer Express.

It is a time that lends itself to reflect on times past, love lost, and the empty chair in the room. A painful memory can easily overshadow the chaos and commotion — even when, or especially when, children are involved.

We suffer in this home, too, and at times it becomes overwhelming to give it all in the season, and we choose to pull back in quiet reflection. It seems appropriate at many times and at others it is best to surround oneself with the love of a solid family and faithful friends. Dealing with Christmas and the weaving into a new year can leave one exposed, exhausted, and feeling down. How we choose to cope is a private affair.

To get through it all, families may wish to have the discussion on how to cope with the season and times ahead. Who needs time out? Who needs to see all the cousins? Who needs a pastor, doctor, counsellor or someone to help with cooking, cleaning and the farm chores? Who wants to do something totally different for a change?

Breaking off from old traditions can be hard but at some time, we become the family and the tradition ourselves. So this is part of the evolution.

At the same time, someone away may need or crave a time that is old and familiar so they can cope with the speed of their world today.

Whatever the desire, it all means a break from the usual schedule and coping with change. Stressed or satisfied — the season of Christmas is here to stay. And that is a good thing.

For underneath the glossy wrap that distracts us is a simple story — a story of the gift of a child. A child that brings hope to us all. A child that forever reminds us of rebirth and starting anew and that a greater power is hanging around our heart just ready to step in. There is a pure beauty to a story that starts with birth — something we all experience. And there is a pure truth to a child — because children are always honest. More importantly, there is the wonderment of being granted a gift of such magnitude.

Regardless of our walk or station in life, we have this gift. And though we may not see this baby, we can see the reflection of that child in those we miss today. Were they not a gift of such magnitude that you can only stand in wonderment that they graced your life? Did they not love you so deeply that you can only whisper their name and know you were needed? Did they not struggle like this baby did later in life and still come to their mother’s arms for a moment of quiet peace and did they not light up the room just with their smile? Of course — this and more. We know our own stories.

Remember this: Although it hurts to remember the past, it is the gift of that time, that person, and that place that we are encouraged to bring ahead. We bring it ahead and unwrap it, understanding that true love is never lost, faithful friends care in this life and the next, moms and dads loved us, and little children filled our lives with light.

As sad as we may feel — these gifts were free. And every Christmas, the “gift of the season” is not in a box or a bag but in the heart.

It brings joy to my life to know that I have been loved despite my many weaknesses and helped by amazing friends when I was down. It brings joy to my heart to know that my legacy lives on in very independent and unique branches of my children and grandchildren. I stand in wonderment at the beauty of my farm and the natural healers that generously share that space with me.

I cannot begin to express my thankfulness to live in a free country — a country where I can open my gift of Christmas at any time without fear of persecution. I’ve got joy in my heart that I have suffered and learned from that pain. And that through it all, I was offered the gift of grace through one small child.

If you are reading this, then I want to thank you for being a gift to me and offering hope and encouragement. I am grateful for the honour to fill this space.

Enjoy your gifts of the season.

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