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4 The Canadian Statesman, Bowmanville, March 1, 1978 Section Two Durham AgriculturalNews By Rod Stork, Assoc. Agricultural Representative Income Tax Considerations In the next two months, farmers like many other people will be completing their income tax returns for the 1977 taxation year. Each year, as we approach the end of the fiscal period for a farm, we get a large number of questions from farmers as to ways that they might increase or decrease their taxable income and put themselves into the most favourable position possible for their farm. There are many things that can be done during the fiscal year to offset taxation problems, and there are many things that can be done after the taxation year has ended that will lower or raise your taxable income. For most farmers, the fiscal year is the calendar year, so the things that can be done during the fiscal year are now past. What now must be considered are some of the things to take into account when completing your income tax form that might lower your tax base. Many of the questions con- cerning income tax changes and how to handle these on your taxation forms are dis- cussed in the 1977 Farmers and Fishermen's Income Tax Guide, which most farmers receive with their tax form, or which can be picked up at the local post offices. All capital items including: machinery, equipment and buildings on a farm can have capital cost allowance taken on them. Farmers should check their Farmers and Fishermen's Guide to see if there are any accelerated or additional capital cost allowances eligible for various types of machinery and equipment. If there are provisions for particular types or items, then normally these can be claimed in addition to your regular capital cost allowance. Another provision of the tax act which applies to farmers and allows for reduction of income tax payable is the investment tax credit. This credit has been extended until July lst of 198b. Basically, the investment tax credit operates as follows: A farmer who purchases equipment or constructs build- ings can deduct 5 per cent of his investment from his Federal Income Tax Pay- ment. The amoint upon which a farmer can takeCapital Cost Allowance on any of the item, should be reduced by 5 per cent before calculating the Capital Cost .Allowance. Forms for calculation of the Investment Tax Credit are available at the Agricultural Office, and farmers who wish can pick them up here or through your District Taxation Office. Another provision of the Tax Act that is being widely used by farmers is that of the Livestock Inventory Pro vision. A farmer who is on the cash basis of tax filing, can establish if he wishes an Inventory Value for calculat- ing income for tax purposes using the Livestock Inventory he has on hand at the end of the fiscal period. The Live- stock Inventory provision is useful in situations where the farmer is in a loss position, or where he can maintain income at a desired level to obtain fuller benefits under the Canada Pension Plan for instance, particularly, if the farmer is nearing retirement and when subsequent incomes are expected to be consider- ably higher. Possibly a dispersal sale is eminent or it is planned to reduce a number of animals on hand over the next few years. There is no special form to use in electing to use of livestock inventory provisions, and it is only necessary to show the amount of inventory as income and-or expense on the farm income and expense statement. The amount should be adequately described, however, to indicate clearly that the election is being made L.e. Livestock Inventory Election December 31, 1977. This would appear as an addition to income on the 1977 statement and, then, must appear on the 1978 tax statement as an addition to expenses, if another election is being made in 1978, this is entirely an independent, separate and distinct from the 1977 election, and should be stated separate- ly as an addition to income in 1978. This in effect renews any carryover from the previous inventory. Further informa- tion of the provisions of the Livestock Inventory and how they might work in your farm situation, can be obtained by contacting your accountant, your bookkeeping service, or the Agricultural Office. The other Tax Management tool that is used widely by farmers at this time of year is that of Averaging Income. There are three different types of averaging that are available to farmers. The first, is general averaging which was introduced as part of the revised income tax act; the tax department looks at each tax payer's individual return, and if his income is 110 per cent above the previous year and 120 per cent above the averaging period, an automatic average will take place. For 1976 and beyond, the averaging period is the before preceding years. The five year block average which most farmers are familiar With is still available to individual farmers. It is a five year backward average consisting of the current year and the four previous years. Thus, benefits or lack of same can be calculated. One cannot block average again for at least another five years, and a year used in block averaging will be left out of the general -E I SAVE SAVE HY PAY MORE FOR HEATING AVE ON PREMIUM QUALITY FUEL OIL FOR ALL YOUR FUEL OLt NEEDS 17 DUNDAS SJ. EAST WHITBY Telephone Today! Call Collect 668-3381 Prompt, Courteous Service aM.a *,on average previsions that we mentioned earlier. As ex- plained in the Farmers and Fishermen's Tax Guide, a farmer must elect to average using Form T2011 and include this form with the tax return for the year of averaging. This provision is still more useful to farmers than the general averaging because of incomes experienced by beef and cash grain growers for instance do not always increase. It can be useful to get back tax dollars paid in better years of a five-year period. The final method of income averaging is that of an income averaging annuity contract, which is a forward averaging provision, and is available for unusual income such as that which occurs at time of changing or ceasing business or retiring. The annuity must be the specific type required avail- able from insurance trust companies. The individual makes single, premium payment and the maximum deduction from income is his eligible annuity contract, less one year's annuity income. Further information on the Income Averaging Annuity Contract and whether it would work in your operation can be obtained from your accountant. These then are some of the tax management methods that can be used by farmers after t'he end of the fiscal year. If you want further details on these, and whether they might fit into your tax picture on your farm, get in touch with your accountant or the Agricultural Office and we will provide you with further details. OBITUARY JAMES HENRY PARKHILL A teacher at Central Collegiate since 1956, where he was commercial director, James Henry Parkhill, 974 Chevrolet Avenue, Usnawa, died suddenly at the Oshawa General Hospital Tuesday, February 21, 1978. Born April. 20, 1907 in Norwich, he was a son of the late Mr. and Mrs. Henry Parkhill. He was married August 20, 1932 in Ottawa and had lived in Oshawa since 1958, coming here from Bow- manville. He was formerly associated with Pine Ridge Training School, Bowmanville, retiring in 1971. He is survived by his wife, the former Lillian Laurnitus of Oshawa; a daughter Mrs. Calvin Blake (Johanne) of Pickering; two sons, Gary Parkhill of Kitchener and James Parkhill of Toronto; a sister, Mrs. Marguerite Town- James Insurance Agency Li mited 24 King St. E. Bowmanville For al your insurance needs Nesta Akey or Doug James at 623-4406 send of Woodstock; two brothers, Clarence of Burges- sville, Ont.; and Willard of Tillsonburg, Ont.; and four grandchildren, Stephen, Michael, Laura and Jason. Mr. Parkhill rested at the Armstrong Funeral Home, Oshawa. Service was held in the chapel Thursday with interment in Mount Lawn Cemetery. Rev. Charles Newton officiated. Memórial donations to the Ontario Heart Fund would be appreciated. Ganaraska The budget for the Ganaraska Region Conserva- tion Authority is about $10,000 higher in 1978 than in 1977. A budget approved by the authority this year totals $450,983 compared to $440,511 in 1977. The Durham Region's contributor to the budget from the Ganaraska Conservation Authority totals approximate- ly $54,000. Other municipal- ities making contributions are: Cobourg, Port Hope and the townships of Haldimand, Hamilton Hope, Cavan and Manvers. Van Belle on Gardening Al about runners, and bulbs A race well run, is an old saying, which does not refer to plant life, but it gives us a comparison with plants, the mother plant will reproduce with runners coming from the centre of the plant and in this way reproduce itself into many more ants, so in that way, plants o run a race well, specially when we think in terms of the jungle, where the fittest will survive. The most commonly plant propagated from runners are the spider- plant and the strawberry begonia and of course the strawberry plant in the garden. The easiest way to get them started is by placing the pot with the mother plant in a larger container or close to another container so that the runners will lay on top of the soil and will throw out roots, let them get well rooted before cutting them of the mother plant, and when they are well rooted transplant in a pot. This would be an excellent project for a classroom, since it will give you the complete reproduction cycle, tying it with nature. Now is the time to get the turberous begonia bulbs started, they will be available at your local florist or garden centre. There is nothing more dainty then the bloom of the tuberous begonia. There are a lot of different sizes on the market at various prices, but you would be well advised to buy the larger sizes to get a better plant with more blooms. They can be started in a flat or box, ,and first place them in a layer of peatmoss, to get the root action started, this will take about 2 to 3 weeks, then transplant them into a fine mixture of soil, sand and peatmoss or buy the mix already on the market. Make sure that they don't dry out, water them sparingly but often so that any exessive moisture will evaporate, and there will be no change of the bulb rotting. They will require a lot of light, either in the form of artificial light or place them close to a window, but do not place them in the sun, this will keep them from stretching, because they will grow toward the light. There are a lot of varieties on the market, the most commonly used varieties are the Camillia flowering types, which resembles a rose fully open, they are usually double, and come in a large range of colors, red, pink and orange and then shades of these colors, the next one is the Fimbriata varieties, which resembles a carnation flower again in all colors. The one variety which is often overlooked is the pendula or hanging varieties, they can be started now in regular pots and then later transplanted to a hanging basket for use outside, again they come in a full range of colors. Multiflora maxima is a variety with masses of small flowers, but gives an excellent show with its mass of color, then there are some special varieties 77 King Street East Bowmanville FANCY IGA Peach HalvesO.N FROZEN Rich s 16Ci T Coflee Rich oz.CR"NLU FLAVOREE Swing Orange Crystals GAINES. BEEF FLAVORES Top Choice Dog Food IGA Long Grain Rice IGA Apple Pie POtY RAS 0F 9 go POUCHES.D x 2.39 M.59c SOC SIZE CI9 Mir Liquid- $ flAtirnAntTWIN PACK OF Detergent x24-FLZ PLASTIC BTLS such as the Pivotee and the Crispa varieties. To overcome any mildew which could appear on the leaves, which is normally caused by too much moisture, either in the air or in the soil medium, use a good fungicide such as Dhaltan, benemyl or captan and dust once every 2 weeks. To keep the new growth compact, you can pinch back the main growth after the shoot has reached 5 to 6 inches, which will make the plant bushier and will transplant better outside. After the danger of frost is over they can be planted outside, but always plant them in the shade, or semishade and never in the full sun, or thev will burn un completely. Until next week, happy garaemng. Perform a death-defying act. Give Heart Fund. Give Heart Fund P Police Asked To Pay The Durham Region Police will be asked to pay $400 per year if they wish to reserve four parking spaces at the Bowmanville Police and Fire Building. The $400 is the amount that four average parking meters would collect in a year. The municipality's finance and administration agreed to charge that amount during a meeting Monday, February 20th. Councillor Bruce Taylor, a member of the committee, estimated that the fee is 46½ cents per day. He described this as "pretty cheap parking." Durham Police need the extra space because more staff are working at the Bowmanville police station. The reserved spaces would be used for parking police officers' cars. 100% VEGETABLE OIL Imperial Soft Margarine TE FANCY, FROZEN BONUS PACK OF 10% FREE Green Giant Sweet Peas or9* BANANA, CHOCOLATE COCONUT OR LEMON. FROZEN Farmhouse Cream Pies PROCESS Kraft Velveeta Cheese PILLSBURY Apple Turnovers -Le $1 Au PKGý 8Um-rF PKG 8tr JU JUBES, GUM DROPS OR ORANGE OR LEMON SUCES Dare's Candies frU Accountancy WILLIAM C. HALL B. Comm. Chartered Accountant 3612 King St. E., Oshawa Telephone 725-6539 D. V. SNODDON 212 Liberty St. North Bookkeeping and Tax Service Business: 623-7950 Residence: 623-7308 JOHN MANUEL, C.G.A. 67 King St. East, Suite 2 623-6555 JOHN P. WINTERS Chartered Accountant 20 Colborne St. W. Oshawa, Ontario Phone 579-5659 or 623-5828 WM. J. H. COGGINS Chartered Accountant 115 Liberty Street South Bowmanville Phone 623-3612 Chiropractic LAURENCE A. GREY Doctor of Chiropractic 270 King St. East Bowmanville Phone 623-4004 G. EDWIN MANN, D.C. Chiropractor Office: 15 Elgin Street Corner of Horsey Street Phone 623 5509 Office Hours: By appointment LEONARD JAY, B. Sc., D, C. Doctorof Chiropractic 96 Queen Street Bowmanville Phone 623-9297 AUSTIN'S, PINK OR LEMON Fabric1FL O Softener PLASTICBTL. Dental DR. ANGUS M. BLAIR D.D.S. 26 Frank St., Bowmanville (near Dominion Store) Office Hours: 9:30 a.m. to 9 p.m. including Saturday Telephone 623-3181 DR. WILLIAM KEANE Dental Surgeon 222 King Street East Professional Bldg. Office Hours: Weekdays9 5 Telephone 623-7412 If busy 623-4731 PATRICK G. DEEGAN DENTURE THERAPY CLINIC 36 King St, W. Office Hours: Mon., Tues., Thurs., Fri. 8:30'ti15:00 PRIZE WINNER U. PHILLIPS Tyrone, Ont. leetwood, B & W 12" Television OPEN DAILY MON.-FRI. 9 a.m. - 9 p.m. SAT. 9 a.m. - 6 p.m. SUN. 10a.m. - 5 p.m. Delivery in Town 623-4161 TIES. I e *0 f Values Effective at Bowmanville Store Only IN OIL TOMATO SAUCE OR MUSTARD SAUCE Brunswick,$1 Sardines 40ZTNS I.,, hi I I M M I I I M M I M 4 I S w si BUSINESS DIRECTORY