CRA confirms that AgriInvest accounts do not taint mooted family farm or fishing corporations

Under the AgriInvest program (and the similar Québec program), if a farmer contributes up to 1% of his allowable net sales (or $15,000, if less) to an AgriInvest account, the federal and provincial government will together fund a matching contribution. The account can accumulate from year to year until it is used to recover from small income shortfalls, or make investments to reduce on-farm risks. CRA indicated that, as these accounts are "net income stabilization accounts,” their amounts are deemed by s. 110.6(1.1) to be nil for purposes of the "share of the capital stock of a family farm or fishing corporation" definition, i.e., a corporation would not be tainted by holding such an account.

Neal Armstrong. Summary of 30 June 2016 External T.I. 2015-0583561E5 Tr under s. 110(1.1).