BakerTilly.ca Logo

Publications

Publications
May 29, 2024 by Thomas Blonde
Farm Alert |  Farming & agriculture | Audit and accounting | Entrepreneurial services | Tax advisory | Business advisory services | Succession planning | 

Concerned about the capital gains inclusion rate?

Many farmers have expressed concerns about the increase in the capital gains inclusion rate. While they are right to be worried about the changes proposed in the 2024 federal budget, no draft legislation has been released yet.

The waiting game

With no draft legislation in place, there are still lots of unknowns.

For that reason, we are advising farmers not to overreact, but to wait and see what the legislation will be. Of course, it would be prudent to speak to your advisor or manager at Baker Tilly for some planning points, but without any draft legislation, we are unable to provide any definitive answers.

What we know so far

Budget 2024 proposed to increase the capital gains inclusion rate from one‑half to two‑thirds, for dispositions occurring on or after June 25, 2024.

Corporations and trusts would be subject to the higher inclusion rate on all capital gains.

For individuals it’s different. The first $250,000 of capital gains you realize each year as an individual would still be at the old inclusion rate of 50 per cent. But any capital gains you realize that are greater than $250,000 would be taxed at the higher rate.

Trying to beat the deadline

If you have a corporation or you’re already in the process of selling a farm or quota that is not covered by a capital gains exemption, it would make sense to try and push that sale through before June 25. Other than that, avoid rushing into any sale before the deadline as it’s such a limited window of time and we don’t know what changes we’ll see once the legislation comes into effect.

Stay tuned for more guidance and advice when details of the new legislation are made public.

Meet the Author

Thomas Blonde Thomas Blonde
Elora, Ontario
D (519) 846-5315 ext. 319
E .(JavaScript must be enabled to view this email address)

Information is current to May 29, 2024. The information contained in this release is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation.

Recommended Content

  • The mid-sized full service commercial firm “playbook”

    I work with as many “mid-sized” commercial law firms as I work with large regional, national or global law firms. As the industry continues its multi-decade embrace of operating scale (bigger is better, or at least more efficient!), what does this trend mean for commercial firms that do not choose to anchor their success to hiring more lawyer bodies across which to allocate their fixed costs?

     

  • Baker Tilly Toronto announces partnership with SickKids Foundation

    Toronto, ON – Baker Tilly Toronto proudly announces a five-year partnership with SickKids Foundation that will contribute funding and employee engagement opportunities in support of The Hospital for Sick Children (SickKids), Canada’s most research-intensive medical facility and the country’s largest centre dedicated to improving children's health. 

     

  • Baker Tilly Canada Capital facilitates insurance firm partnership

    Windsor, ON – Baker Tilly Canada Capital Corporation is pleased to announce a strategic partnership between All-Risks Insurance Brokers Limited (All-Risks) and StoneRidge Insurance Brokers (SIB). Baker Tilly Canada Capital served as exclusive financial advisor to All-Risks and its shareholders.