Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Agriculture and Agrifood Canada Policy Branch Payments, Systems and Procedures 933684 2200 Walkley Road 2nd Floor Ottawa, Ontario K1A 0C5
Attention: Garth McKane
January 4, 1994
Dear Mr. McKane:
This is in reply to your facsimile of December 16, 1993, requesting our view on whether Tax Information Slips would be required relating to two types of payments to be made to producers in 1994. These payments can be described as follows:
Refund of premiums
As a result of terminating a cattle program for which the producer paid a premium for cattle, premiums paid in respect of cattle that have not been sold up to December 31, 1993 will be refunded to the producer in 1994. Such premiums paid in 1993 and earlier years would have been treated as an expense in computing farm income in the year of payment.
Cow/calf program surplus
This program has been terminated and the surplus that exists must be divided equally among both levels of government (Federal and Provincial) and the producers. The surplus represents the premiums paid under the stabilization program since 1986 plus accrued interest thereon. These premiums would have been expensed in previous years and each producer will receive a cheque for his/her share plus interest. "Farm support payment" is defined in Income Tax Regulation subparagraph 234(2)(c)(i) which reads as follows:
"(c) a rebate of or compensation for all or a portion of
(i) a cost or capital cost incurred in respect of farming".
You are of the view that the payments described above should be included on Tax Information Slips for 1994. Since the payments in question fall within the definition (as underlined), we agree that they are farm support payments and that T-slips are required where payments are in excess of $100.
We trust that we have clarified this matter to your satisfaction.
Yours truly,
R. Albertfor DirectorBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch
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© Her Majesty the Queen in Right of Canada, 1993
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