The Milk Producer - September 2009 - (Page 18)

FARMFINANCE By John Hunt Money harmony New blended sales tax will require advanced planning to lessen impact on your cash flow n March, the Ontario government introduced its budget for the coming year and announced a new harmonized sales tax (HST). Ontarians will pay a combined rate of 13 per cent goods and services tax (GST) and provincial retail sales tax (RST), effective July 1, 2010. The provincial portion will be eight per cent, the same as the general RST rate, and the federal portion five per cent. The implications to your farm are a little different than those for other businesses. For one, cash flow will be a main concern since most farm expenses are currently subject to only the GST. Starting in July, such expenses will require the new 13 per cent rate. This will increase the amount of taxes you pay up front. Now is a good time to do some financial planning to prepare for the harmonized tax since you’ll have to budget accordingly for these increased costs. Consider filing your returns more frequently to get HST refunds sooner. Instead of filing annually, you could file your return quarterly or even monthly to minimize the impact on your budget. The good news is most of the HST you will pay for business expenses can be claimed back as input tax credits (ITCs), whereas Starting in July, the HST you will pay on farm vehicles will be refundable. 18 | September 2009 | MilkPRODUCER I

Table of Contents for the Digital Edition of The Milk Producer - September 2009

Milk Producer - September 2009
Contents
Editor's Notes
DFO Chair's Message
Dairy Update
Farm Finance
DFC Promotion
World School Milk Day
Producer Profile
Research
Environmental Issues
Ruminations
Applied Science
Markets
New 'N' Noted
Back Forty

The Milk Producer - September 2009

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