As tax season approaches, Canadian farmers face significant changes in federal tax filing requirements for 2024. Understanding these updates is crucial for maintaining compliance and avoiding penalties.
Underused Housing Tax
The Underused Housing Tax (UHT) Act of 2022, imposing taxes on vacant and underused housing owned by non-Canadians, has seen adjustments beneficial to farmers.
Following advocacy efforts by Canadian Federation of Agriculture, as well as several provincial associations, such as the Ontario Federation of Agriculture, farm businesses now enjoy an exemption from the UHT filing if over 90% of ownership is by Canadian citizens or permanent residents, for the tax year 2023 and onwards. The penalty for non-compliance has also been reduced.
T3 reporting rules for trusts
The federal government has updated the T3 reporting rules for trusts. Now, most Canadian trusts must file an annual T3 return, including detailed information about all parties involved.
This change, taking effect for taxation years ending after December 30, 2023, impacts farm businesses using trusts for estate planning or holding assets.
GST/HST returns
Electronic filing for GST/HST returns becomes mandatory in 2024. The Canada Revenue Agency offers multiple electronic filing options, including GST/HST NETFILE and TELEFILE, ensuring accessibility for all farmers, even those with limited internet access.
To ease the tax filing process, maintaining up-to-date financial records and seeking professional advice is recommended.
The Ontario Federation of Agriculture (OFA) offers tax resources for farmers, including a fact sheet on these tax changes, to assist farmers in navigating the evolving tax landscape.