Food donation tax credit will be retroactive to Jan. 1, 2014

Tuesday, September 30, 2014

by SUSAN MANN

Corporations operating a farming business in Ontario that donate to eligible community food programs can also get the Food Donation Tax Credit for Farmers, the Ontario government says.

Ontario Agriculture, Food and Rural Affairs Minister Jeff Leal announced Monday in Hamilton the tax credit, valued at 25 per cent of the fair market value of the agricultural products farmers and farming corporations donate to community food programs, is now available. Farmers can claim donations retroactive to Jan. 1.

The tax credit is part of the Local Food Act passed last year. But the Ontario government needed to do additional work and have discussions with the Canada Revenue Agency before the credit “could officially come into force,” says Bryan Bossin, Leal’s press secretary and communications assistant.

Leal says in a Sept. 29 press release the tax credit “is an integral part of our government’s commitment to support farmers, increase access to nutritious, locally grown food and promote the good things that are grown right across the province.”

Eligible products include: fresh fruits and vegetables, eggs and dairy, meat and fish, grains and pulses, herbs, honey and maple syrup, mushrooms and nuts. But processed products, such as pickles, preserves or sausages aren’t eligible.

Farmers can claim the credit on their personal income tax and benefit return while corporations can claim it on their corporation income tax return. If filing a paper return, official receipts for qualifying donations must be attached to the return, while for electronically filed returns, people should keep their receipts for six years, the agriculture ministry release says.

Mark Wales, Ontario Federation of Agriculture president, says the tax credit is a  “win-win for everybody.”

But “it’s be a matter of promoting it so we’ll all have to do a bit of work on that just to let people know it’s available,” he says. “We’ll obviously have to do a bit of promotion now but the real promotion will be next spring.”

As for how easy or hard it will be for farmers to claim the credit, Wales says he hasn’t seen the process yet but “I hope it’s fairly simple because this is pretty straight forward. It will just take a little time and bit of education so that everybody understands how to use it and then how to get the credit, obviously. It will also take a while for accountants to understand what it is.” BF