The deadline is nearing to submit your 2011 program forms, without penalty. Inside this latest Industry Advisory learn about what has changed for meeting the deadline this year and how to use a new online tool for submitting this information to SCIC.
September 30, 2012 Deadline
September 30, 2012, is when AgriStability forms for the 2011 program year are to be filed. There are a couple of key benefits to meeting this deadline. By submitting program forms on or before this date processing can begin sooner. Participants filing their forms by September 30 also avoid a $500 per month penalty, which is deducted from any AgriStability benefit for forms submitted between October 1 and the final deadline of December 31.
The Saskatchewan Crop Insurance Corporation (SCIC) wants to ensure there is easy access to the support and tools needed to effectively work with the AgriStability Program. The 21 customer service offices across the province have staff and resources for producers, accountants or form preparers with questions about completing program forms or information needed to calculate AgriStability benefits. Do not forget about SCIC’s online tool for working with AgriStability. AgConnect is an efficient new way to complete and submit 2011 program forms (see below for more details).
Another great resource for the AgriStability Program are SCIC’s AgriStability Advisors. These program experts are spread throughout the province and can provide advice on working with this business risk management program. They can help clarify any concerns or issues that may come up, and can be contacted through the customer service offices.
Access to all the forms and guides for completing the forms, can be found at www.saskcropinsurance.com. Program inquiries can also be made by contacting the AgriStability call-centre at 1-866-270-8450.
What forms to use?
As part of SCIC’s effort to bring the AgriStability Program closer to Saskatchewan producers, new program forms were developed for the 2011 program year. By utilizing these forms and following the correct submission steps, participant’s should see a reduction in turnaround time for processing. Individuals (sole proprietors) can still file for both AgriStability and AgriInvest by using the new T1163 form. This form is available at www.saskcropinsurance.com and is to be used for individual participants to report their relevant tax (income and expense) information. The T1163 needs to be sent to the Canada Revenue Agency (CRA) in Winnipeg, as has been done in the past. The CRA then shares the income and expense information with SCIC for AgriStability. If individual participants want their income and expense information to arrive at SCIC sooner, for quicker processing of their AgriStability application, they can use AgConnect to provide this data (see below for more details). Please note: If individuals use AgConnect to submit income and expense information to SCIC, the T1163 is still required to be completed and submitted to the CRA.
New for the 2011 program is the requirement for individuals (sole proprietors) to submit their supplementary information directly to SCIC. Items such as crop or livestock inventory, deferrals, purchased inputs, accounts payable and receivable, are now to be reported on SCIC’s new Supplemental Accrual Information form. This new form is to be submitted directly to SCIC, not to the CRA in Winnipeg. The new Supplemental Accrual Information form can be submitted to SCIC using AgConnect, dropping it off at any of the 21 customer service offices across the province, by mail or fax.
This change in form filing means SCIC is bringing another aspect of administering the AgriStability program closer to home. The new Supplemental Accrual Information form can be found at www.saskcropinsurance.com/agristability/forms.
For corporations, co-operatives and other entities, they will continue to follow the same guidelines as they have in previous years. The Corporations, Co-operatives and Other Entities form is to be completed and submitted directly to SCIC. This form can also be completed and submitted using AgConnect. When corporations send in their AgriStability forms they also need to submit a copy of their T2 Schedule 1 that is filed with their income tax return. This information is used by SCIC to verify a participant has filed their tax return and meets the eligibility requirements.
Should you have questions about the new forms being used or where they are to be submitted please contact your nearest AgriStability Advisor or call the AgriStability call centre at 1-866-270-8450.
Use AgConnect to meet September 30 deadline
AgConnect is a great new way to provide the information required to participate in the AgriStability Program. AgConnect is SCIC’s online tool for reviewing and submitting AgriStability information. By using the eForms feature, participants and/or their contact(s) can complete and submit programs forms electronically to meet the September 30 form submission deadline. Using AgConnect also provides the potential for quicker processing as the information directly enters SCIC’s computer system eliminating the time it takes to manually transfer the data from a paper file into the computer system.
To use AgConnect you must either be a participant or a contact person. Letters were sent in March providing the access code and instructions for accessing the AgConnect website. If you misplaced this letter or your access code please contact the AgriStability Call Centre at 1-866-270-8450 and they can help you get started with AgConnect.
To learn more about AgConnect go to: www.saskcropinsurance.com/agristability/agconnect.
How to record PDAP payments
The Provincial Disaster Assistance Program (PDAP) was used in 2011, due to the excess moisture across a large part of the province. PDAP assistance was provided for a number of circumstances and could be considered as allowable or non-allowable depending on what the funding was used for. When reporting PDAP income for AgriStability it is important that funding be broken out based on the type of loss it was offsetting.
For example: Joe Farmer received a $5,000 PDAP payment; $3,000 was to cover grain that was destroyed when a bin was flooded. The remaining $2,000 was for gravel to help fill in the bin yard where flooding had damaged access to the grain storage. When reporting this for AgriStability, $3,000 should be listed as allowable income as it was for an agricultural commodity that was held in inventory.
If you have questions about how PDAP payments are to be reported for AgriStability, please contact the AgriStability Call Centre at 1-866-270-8450.
AgriStability and Canada Revenue Agency – Method of Accounting
When reporting information for AgriStability purposes it is important it matches what was submitted to the Canada Revenue Agency (CRA). When discrepancies occur, processing of AgriStability applications can be slowed down as it takes time to determine why the information does not match. Here are some suggestions for ensuring the CRA and AgriStability information are consistent:
• If you file to the CRA on a cash basis, your AgriStability form should also be completed using the same cash information.
• If you file to the CRA on an accrual basis, your AgriStability form should also be completed using the accrual method.
o Accrual to cash/cash to accrual worksheets can aid in processing of the file.
• If the fiscal year of the farming operation(s) has changed, provide the documentation from the CRA approving the change of year-end.
• If an adjustment is made to AgriStability forms that impact the gross farming income, total expenses or net farm income (loss), the adjustment must also be sent to the CRA.
• For corporations, ensure the farm income information provided for AgriStability matches the farm income information on the T2 Schedule 1 from the CRA. If the information does not match, please attach additional information to reconcile the two amounts.
If you require further information about the method of accounting used for AgriStability, please contact the AgriStability Call Centre at 1-866-270-8450.
2012 final program forms – now accepted
SCIC is now accepting final program forms for the 2012 program year. Farming and ranching operations with a non-calendar year-end can complete and submit their final program forms at any time. The forms and guides can be found at www.saskcropinsurance.com/agristability.
Code changes for 2012
Significant changes have been made to the commodity code lists used for the 2012 AgriStability Program.
These changes are part of an ongoing effort to align the AgriStability Program with producers’ business practices and to remove duplicate or redundant codes. The change in the marketing of Western Canadian wheat and barley also prompted some of these code changes.
Commodity codes are used when completing AgriStability Program forms to identify sales and purchases of specific commodities. Be sure to use the correct codes when completing program forms, which will help avoid unnecessary delays in processing applications.
The removed and added codes for the 2012 program year are listed in the attached Appendix A. The entire updated code list for the 2012 program year can be found in SCIC’s 2012 Commodity Code Guide at www.saskcropinsurance.com/agristability/publications.
AgriStability adjusts to CWB changes
The changes to the Canadian Wheat Board (CWB) and the new options for marketing wheat and barley in Saskatchewan are going to impact the AgriStability Program. For the 2012 program year, AgriStability participants will notice some slight adjustments in the way they report sales of CWB commodities.
The biggest adjustment will be the use of different codes when reporting inventory of wheat and barley on 2012 AgriStability Program forms. The Saskatchewan Crop Insurance Corporation (SCIC) has reduced the number of inventory codes for wheat and barley from 92 to 29. Instead of having different codes for varying grades and protein levels, SCIC has limited the codes to the grade of the grain marketed (e.g. Wheat, CWRS, No.2). By providing more general classes for wheat and barley inventory, the grain can be more easily recorded when reporting inventory for the AgriStability Program.
SCIC will also be providing assigned prices for the 29 wheat and barley codes. As has been done in the past, these assigned prices will be based on market data gathered from a number of sources including the CWB and elevator companies. These prices will be used to value the inventory of the participant’s wheat or barley.
Participants also have more flexibility reporting their pooled commodity information as they can now record any adjustment, interim or final payments from the sale of pooled commodities as a receivable adjustment in Section 11 of the program forms. This will help participants account for any payments still owed for the sale of their CWB grains in the 2012 program year.
SCIC will continue to offer the CWB Receivables Adjustment Worksheet for those participants who may feel the assigned prices do not reflect the actual value of the CWB commodities in inventory.