Did you know that a farmer carrying on business in a prescribed drought region may defer a portion of income earned in the year from sales of breeding animals? The amount of deferral depends on the percentage of reduction of the breeding herd:
The deferred amount must be included in income by the first taxation year after the farm is no longer in a prescribed drought region.
The current prescribed drought regions are announced annually by Agriculture and Agri-Food Canada, after the calendar year end. For 2007, the list of designated regions include parts of southern British Columbia, southern Alberta, southwest Saskatchewan and Ontario. Click for list of prescribed drought regions for 2007.