Ontario Ministry of Agriculture, Food and Rural Affairs
DISADVANTAGES ADDED OPERATING EXPENSES Transportation Admin. & Promotion Feed Costs Health & Vet Breeding Other Direct REDUCED INCOME Down Pymnt. Interest Lost Other NON-ANNUAL EXPENSES ITEM 1 2 3 ADVANTAGES CAPITAL SALES/DISPOSALS $2.37 $1.77 $22.50 $1.25 $1.15 $1.87 $/HL $/HL $/HL $/HL $/HL $/HL
INFLATION FACTOR 2 2 2 2 1 2 % % % % % %
AMOUNT $455.29 $340.03 $4,322.37 $240.13 $220.92 $359.24 AMOUNT $400.00 $0.00
CASH BASIS DAIRY QUOTA INVESTMENT WORKSHEET
Revised May, 2006 NAME: Dairy Farms PRODUCER LICENSE NUMBER PRODUCTION INFORMATION COMPONENTS: DATE: 14-Aug-08 BUTTERFAT PROTEIN OTHER SOLIDS # OF YEARS OF PROJECTION: ( Maximum 15 Years ) $50,000 Business Structure Codes: 1 Sole Proprietorship Partnership 2 Corporation 3.80 KG/HL 3.28 KG/HL 5.72 KG/HL 15
REQUIRED RATE OF RETURN: DOWN PAYMENT PROVIDED : PRESENT TAXABLE INCOME:
4.00 % $10,000
$/HL
INFLATION FACTOR YOUR RATE OF RETURN 0 %
YR.( 1-15 ) 0 0
AMOUNT $0.00 $0.00
BUSINESS STRUCTURE (enter number code) : Note: If a Partnership Enter Number of Partners
- PURCHASES PURCHASE # 1: - DESCRIPTION : - AMOUNT : - BID PRICE / KG : - TOTAL VALUE : - % C.C.A.ELIGIBLE: - % C.C.A.YEAR 1 : - C.C.A. RATE % : ASSET PURCHASE # 2: - DESCRIPTION : - AMOUNT : - % C.C.A.ELIGIBLE: - % C.C.A.YEAR 1 : - C.C.A. RATE % : ASSET PURCHASE # 3: - DESCRIPTION : - AMOUNT : - % C.C.A.ELIGIBLE: - % C.C.A.YEAR 1 : - C.C.A. RATE % :
- LOAN INFORMATION LOAN # 1 : QUOTA 2 $29,700 $59,400 75 100 7 KG LOAN REQUIREMENT: INTEREST RATE : TERM ( YEARS ) : PAYMENTS / YEAR COMPOUNDS/YR $49,400 6.50 % 10 12 12 ADDED ANNUAL INCOME OPERATING REVENUE Added Milk Sales Other Added Livestock Sales Other
YR.( 1-15 ) 0 0
AMOUNT $0.00 $0.00
% % %
$68.48 $0.00 $1.50 $0.00 $0.00
$/HL $/HL $/HL $/HL $/HL
INFLATION FACTOR 0 % 0 % 0 % 0 % 0 % INFLATION FACTOR 0 % 0 %
AMOUNT $13,155.69 $0.00 $288.16 $0.00 $0.00 AMOUNT $0.00 $0.00
Building $15,000 100 % 50 % 10 %
LOAN # 2 : LOAN REQUIREMENT: INTEREST RATE : TERM ( YEARS ) : PAYMENTS / YEAR COMPOUNDS/YR LOAN # 3 : LOAN REQUIREMENT: INTEREST RATE : TERM ( YEARS ) : PAYMENTS / YEAR COMPOUNDS/YR
REDUCED COSTS $15,000 6.50 % 15 12 12
Cattle $2,000 100 % 100 % 100 %
$2,000 6.50 % 5 12 12
SUMMARY REPORT BASED ON TOTAL INVESTMENT: BEFORE TAX AVERAGE ANNUAL NET RETURNS : $4,430 INVESTMENT : $76,400 PAYBACK YEARS : >15+yrs
ROI -15 yr 5.8%
AFTER TAX $3,959 $76,400 >15+yrs
ROI -15 yr 5.2%
SUMMARY REPORT BASED ON INVESTMENT IN QUOTA ONLY: BEFORE TAX ROI -15 yr AVERAGE ANNUAL NET RETURNS : $5,022
AFTER TAX $4,071
ROI - 15 yr
DOMESTIC MILK PRICING Component Butterfat Protein Other Solids SNF Adjustment Maximum Allowed SNF Ratio Farm Solids Non Fat to Fat Ratio (SNF) Total / hl Total / kg BF kg/hL 3.80 3.28 5.72 $/kg $9.51 $7.27 $1.53 Total $36.14 $23.85 $8.75 -$0.25
Over Quota Milk Component kg/hL Butterfat 3.80 Protein 3.28 Other Solids 5.72
$/kg -$9.64 -$7.02 -$1.44
Total ($36.63) ($23.03) ($8.24)
2.35 2.37 $68.48 $18.02 Total / hl Total / kg ($67.89) ($17.87)
Deductions Transportation Administration Promotion DHI Levy Research Total Net / hl Net / kg $/hl $2.37 $0.45 $1.22 $0.06 $0.04 $4.14 $64.34 $16.93
Deductions Transportation Administration Promotion DHI Levy Research Total Net / hl Net / kg $2.37 $0.45 $1.22 $0.06 $0.04 $4.14 ($72.03) ($18.96)
CASH BASIS CAPITAL INVESTMENT WORKSHEET
Ontario Ministry of Agriculture, Food and Rural Affairs Economic Development Unit & Livestock Technology Branch
- Basic Information Required Rate of Return Down Payment Provided # of Years of Projection (Maximum 15 Years) Total Capital Expense: 4 $10,000 15 $76,400
- Loan Information LOAN #1 Loan Requirement $49,400 Interest Rate 6.5 Term (Years) 10 Payments / Year 12 Compounding Periods / Year 12 Loan Payment 560.93 Annual Loan Payments 6,731.12 Years> 0 1 $49,400 $15,000 $2,000 $3,627 $611 $350 2 $45,773 $14,389 $1,650 $3,870 $652 $373 3 $41,903 $13,737 $1,277 $4,129 $696 $398
DATE: LOAN #2 Loan Requirement Interest Rate Term (Years) Payments / Year Compounding Periods / Year Loan Payment Annual Loan Payments Years 4 $37,774 $13,042 $878 $4,406 $742 $425 5 $33,369 $12,299 $453 $4,701 $792 $453 6 $28,668 $11,508 $0 $5,015 $845 $0 7 $23,653 $10,663 $0 $5,351 $901 $0 8 $18,302 $9,761 $0 $5,710 $962 $0 9 $12,592 $8,799 $0 $6,092 $1,026 $0 10 $6,500 $7,773 $0 $6,500 $1,095 $0 11 $0 $6,678 $0 $0 $1,168 $0 12 $0 $5,510 $0 $0 $1,247 $0 $15,000 6.50 15 12 12 130.67 1,567.99 LOAN #3 Loan Requirement Interest Rate Term (Years) Payments / Year Compounding Periods / Year Loan Payment Annual Loan Payments $2,000 6.50 5 12 12 39.13 469.59
14-Aug-08
DISADVANTAGES
Net Present Value Outst. Pr. #1> Outst. Pr. #2> Outst. Pr. #3> $39,239 $10,607 $1,772
13 $0 $4,263 $0 $0 $1,330 $0
14 $0 $2,933 $0 $0 $1,419 $0
Added Capital Expenses Principal - Loan # 1 Principal - Loan # 2 Principal - Loan # 3 Added Operating Expenses Interest - Loan # 1 Interest - Loan # 2 Interest - Loan # 3 Transportation Admin. & Promotion Feed Costs Health & Vet Breeding Other Direct NON-ANNUAL EXPENSES Total Added Expenses: Reduced Income Down Pynt Interest Lost Other Total Reduced Income TOTAL DISADVANTAGES
$15,357 $6,827 $319 Inflation $5,752 $4,296 $54,610 $3,034 $2,617 $4,539 $0 NA $148,968 2 2 2 2 1 2
$3,104 $957 $120 $455 $340 $4,322 $240 $221 $359 $0 $14,707
$2,861 $916 $96 $464 $347 $4,409 $245 $223 $366 $0 $14,823
$2,602 $872 $71 $474 $354 $4,497 $250 $225 $374 $0 $14,942
$2,326 $826 $45 $483 $361 $4,587 $255 $228 $381 $0 $15,063
$2,031 $776 $16 $493 $368 $4,679 $260 $230 $389 $0 $15,187
$1,716 $723 $0 $503 $375 $4,772 $265 $232 $397 $0 $14,843
$1,380 $667 $0 $513 $383 $4,868 $270 $235 $405 $0 $14,972
$1,021 $606 $0 $523 $391 $4,965 $276 $237 $413 $0 $15,103
$639 $542 $0 $533 $398 $5,064 $281 $239 $421 $0 $15,237
$231 $473 $0 $544 $406 $5,166 $287 $242 $429 $0 $15,373
$0 $400 $0 $555 $414 $5,269 $293 $244 $438 $0 $8,781
$0 $321 $0 $566 $423 $5,374 $299 $246 $447 $0 $8,923
$0 $238 $0 $577 $431 $5,482 $305 $249 $456 $0 $9,068
$0 $149 $0 $589 $440 $5,591 $311 $251 $465 $0 $9,215
$4,447 $0 $4,447 $153,415
NA 0
$400 $0 $400 $15,107
$400 $0 $400 $15,223
$400 $0 $400 $15,342
$400 $0 $400 $15,463
$400 $0 $400 $15,587
$400 $0 $400 $15,243
$400 $0 $400 $15,372
$400 $0 $400 $15,503
$400 $0 $400 $15,637
$400 $0 $400 $15,773
$400 $0 $400 $9,181
$400 $0 $400 $9,323
$400 $0 $400 $9,468
$400 $0 $400 $9,615
l Affairs
15 $0 $1,514 $0 $0 $1,514 $0
$0 $54 $0 $601 $449 $5,703 $317 $254 $474 $0 $9,365
$400 $0 $400 $9,765
ADVANTAGES Added Income Capital Sales/Disposals $0 NA $0 NA Operating Revenue Added Milk Sales Other Added Livestock Sales Other Total Added Income: Reduced Costs $146,270 $0 $3,204 $0 $0 $149,474 $0 $0 $0 $149,474 ($3,941) 0 0 0 0 0
Years> 1 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$1,663 2 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$1,779 3 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$1,898
Years 4 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$2,019 5 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$2,143 6 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$1,800 7 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$1,928 8 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$2,059 9 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$2,193 10 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 -$2,329 11 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 $4,263 12 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 $4,121 13 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 $3,976 14 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 $3,829
0 0
Total Reduced Costs TOTAL ADVANTAGES: NET GAIN (OR LOSS)
- Income Tax Considerations Marginal Tax Rates (Ont. 2005 incl. Fed. & Prov. Surtaxes): See Notes on Tax Page . ( The corporate tax calculations do not function for corportations with over $1,128,519 taxable Income or $10 million in Taxable Capital ) Capital Cost Allowance Tables Rate % |Asset Cost |UCC> Asset Purchase 1 7.00 $44,550 $41,432 $38,531 $35,834 $33,326 $30,993 $28,823 $26,806 $24,929 $23,184 QUOTA C.C.A. $3,119 $2,900 $2,697 $2,508 $2,333 $2,170 $2,018 $1,876 $1,745 $1,623 Asset Purchase 2 Building Asset Purchase 3 Cattle Total C.C.A. Expense Taxable Income: Before Tax payable: Before $50,000 After: $10,788 After: 10.00 C.C.A. 100.00 C.C.A. $15,000 $750 $2,000 $2,000 $5,869 $47,056 $9,721 ($1,663) $14,250 $1,425 $0 $0 $4,325 $48,790 $10,411 ($1,779) $12,825 $1,283 $0 $0 $3,980 $49,345 $10,584 ($1,898) $11,543 $1,154 $0 $0 $3,663 $49,891 $10,754 ($2,019) $10,388 $1,039 $0 $0 $3,372 $50,431 $10,922 ($2,143) $9,349 $935 $0 $0 $3,104 $50,956 $11,086 ($1,800) $8,414 $841 $0 $0 $2,859 $51,466 $11,244 ($1,928) $7,573 $757 $0 $0 $2,634 $51,979 $11,404 ($2,059) $6,816 $682 $0 $0 $2,427 $52,499 $11,566 ($2,193) $6,134 $613 $0 $0 $2,236 $53,029 $11,731 ($2,329)
$21,561 $1,509 $5,521 $552 $0 $0 $2,061 $53,370 $11,837 $4,263
$20,052 $1,404 $4,969 $497 $0 $0 $1,901 $53,467 $11,868 $4,121
$18,648 $1,305 $4,472 $447 $0 $0 $1,753 $53,554 $11,895 $3,976
$17,343 $1,214 $4,025 $402 $0 $0 $1,616 $53,631 $11,919 $3,829
NET CASH POSITION (BEFORE TAX) (INCLUDING PRINCIPAL PAYMENTS) TAX PAID - INCREASE OR (DECREASE)
($1,067)
($377)
($204) $37,518 ($1,694) ($3,693)
($34) $37,227 ($1,985) ($5,678)
$134 $36,935 ($2,277) ($7,955)
$298 $37,115 ($2,097) ($10,053)
$457 $36,828 ($2,385) ($12,437)
$616 $36,537 ($2,676) ($15,113)
$778 $36,241 ($2,971) ($18,084)
$944 $35,939 ($3,273) ($21,357)
$1,050 $42,425 $3,213 ($18,144)
$1,080 $42,253 $3,041 ($15,103)
$1,107 $42,082 $2,869 ($12,234)
$1,131 $41,910 $2,698 ($9,536)
NET CASH POSITION AFTER TAXES $38,616 $37,810 & PRINCIPAL ARE PAID NET CHANGE IN POSITION ($596) ($1,403) from INVESTMENT CUMULATIVE Position ($1,999) Note: Liability for the interpretation of these results, rests with the user.
PAGE 2 15 $0 $0 $13,156 $0 $288 $0 $0 $13,444 $0 $0 $0 $13,444 $3,678
$16,129 $1,129 $3,622 $362 $0 $0 $1,491 $53,701 $11,941 $3,678
$1,153 $41,738 $2,525 ($7,011)
Sole Proprietorship Taxable Income: Before Tax payable: Before $50,000 After: $10,788 After: 1 $47,056 $9,721 2 $48,790 $10,411 3 $49,345 $10,584 4 $49,891 $10,754 5 $50,431 $10,922 6 $50,956 $11,086 7 $51,466 $11,244 8 $51,979 $11,404 9 $52,499 $11,566 10 $53,029 $11,731 11 $53,370 $11,837 12 $53,467 $11,868 13 $53,554 $11,895 14 $53,631 $11,919 15 $53,701 $11,941
Partnership Taxable Income: Before Partners Income: Before Total Tax payable: Before Individual Tax Payable:Before Corporations ( Based on Fed - Prov. Combined Rates) Taxable Income: Before Total Tax payable: Before $50,000 After: $9,310 After: $47,056 $8,762 $48,790 $9,085 $49,345 $9,188 $49,891 $9,290 $50,431 $9,390 $50,956 $9,488 $51,466 $9,583 $51,979 $9,678 $52,499 $9,775 $53,029 $9,874 $53,370 $9,937 $53,467 $9,956 $53,554 $9,972 $53,631 $9,986 $53,701 $9,999 $50,000 After: $25,000 After: $7,540 After: $3,770 $47,056 $23,528 $6,737 $3,368 $48,790 $24,395 $7,210 $3,605 $35,820 $24,672 $7,362 $3,681 $49,891 $24,945 $7,511 $3,755 $50,431 $25,216 $7,632 $3,816 $50,956 $25,478 $7,744 $3,872 $51,466 $25,733 $7,853 $3,926 $51,979 $25,989 $7,962 $3,981 $52,499 $26,249 $8,073 $4,036 $53,029 $26,515 $8,186 $4,093 $53,370 $26,685 $8,258 $4,129 $53,467 $26,733 $8,279 $4,139 $53,554 $26,777 $8,297 $4,149 $53,631 $26,816 $8,314 $4,157 $53,701 $26,851 $8,329 $4,164
Tax
Page 7
Quota Investment Analyzer - Annual Cash Flow Change
$5,000 $4,000 $3,000 $2,000 $1,000 $0 ($1,000) ($2,000) ($3,000) ($4,000)
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Annual Cash Flow Change After Tax
Annual Cash Flow Change After Taxes and Principal Payments
This graph shows the annual net cash flow change as a result of making the investment compared to not making the investment. One line shows the annual net cash flow change including income tax impacts, but excluding principal payments. The second lin e includes the impact of both income tax and the principal payments on the annual net cash flow change.
Quota Investment Analyzer - Investment Position
$0 -$10,000 -$20,000 -$30,000 -$40,000 -$50,000 -$60,000 -$70,000 -$80,000 -$90,000
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Outstanding Investment using net present value
Outstanding Investment on cash basis
This graph shows the net position of the investment over time. It is based on the original cost and reflects the accumulated adjustments for the annual net cash flow changes including principal payments and taxes.
This calculation does not include any future sale value of the assets.
At the start (time equals zero), the investment position is the full cost of the investment and is shown as a negative dolla r amount. A positive annual net cashflow change resulting from making the investment is a return on the investment and is adde d to the investment position. When the investment position equals zero the cost of the investment has been paid back from the accumulated annual net cash flow changes.
When the investment position equals zero the corresponding time is the number of years of the payback period. When the investment position is above zero then there is a gain from the investment greater than the original cost of the investment. One line is the cash basis position, while the second line includes a present value adjustment, based on the principle that a dollar received in the future is worth less than a dollar received today.
RATES OF CAPITAL COST ALLOWANCE (DEPRECIATION)
This Schedude* shows each asset opposite class number under part XI Capital Cost Allowance. The maximum rate of each class are shown at the bottom of the page.
Depreciable property Aircraft - Acquired before May 26, 1976 Aircraft - Acquired after May 25, 1976 Automobiles Bee equipment Boats and component parts Breakwaters Cement or stone Wood Brooders Buildings and component parts Wood, galvanized, or portable Other: Acquired after 1978 and before 1988* Acquired after 1987 Fruit and vegetable storage (after Feb. 19, 1973) Casing, cribwork for waterwells Chain saws Cleaners - grain or seed Combines Drawn Self-propelled Computer hardware and systems software Computer Equipment acquired after March 22, 2004 Coolers - Milk Cream separators Cultivators Dams Cement, stone, wood, or earth Data network infrastructure aquired after March 22, 2004 Diggers - All types Discs Docks Drills - All types Dugouts, dikes, and lagoons Electric-generating equipment portable Acquired after May 25, 1976 Electric motors Elevators Engines - Stationary Fences - All types Forage harvesters Drawn Self-propelled Graders - Fruit or vegetable Grain-drying equipment
Part XI Class No. 16 9 10 8 7 3 6 8 6 3 1 8 8 10 8 8 10 10 45 8 8 8 1 46 8 8 3 8 6 8 8 8 8 6 8 10 8 8
Grain loaders Grain separators Grain-storage building Wood, galvanized steel Other Greenhouses (all except as noted below) Greenhouses of rigid frames covered with replaceable flexible plastic (this applies to taxation years after 1988 for greenhouses acquired after 1987 Grinder Harness Harrows Hay balers and stookers Drawn Self-propelled
8 8 6 1 6
8 8 10 8 8 10
* You may add to or alter a class 3 building after 1987. In this case, there is a limit on the amount you can include in
Maximum Rates Class 1 Class 2 Class 3 Class 6 Class 7 Class 8 Class 9 Class 10 Class 10.1 Class 12 Class 16 Class 17 Class 45 Class 46 4% 6% 5% 10% 15% 20% 25% 30% 30% 100% 40% 8% 45% 30%
The rate claimed may be varied from year to year but must not exceed the maximum rate in any year. Refer to the current issue of Farmers Tax Guuide for a more complete and up-do-date schedule.
Note: Quota is not subject to the 50 % first year regulations. The rules permit 75% of the investment to be depre at a rate of 7% per year, from year one forward.
For details on the CCA rates for classes 13, 14, 34, 43, 45, 46 and Part XVII of the Income Tax Act, contact the Tax
Cost Allowance.
Depreciable property Hay loaders Ice machines Incubators Irrigation equipment - Overhead Irrigation ponds Leasehold interest Manure spreaders Milking machines Mixers Mowers Nets Office equipment Outboard motors Passenger vehicles Piping - Permanent Planters - All types Ploughs Pumps Rakes Roads or other surface areas - Paved or concrete Silo fillers Silos Sleighs Sprayers Stable cleaners Stalk cutters Swathers Drawn Self-propelled Threshers Tile or concrete drainage system - Acquired before 1965 Tillers - All types Tools Less than $200 $200 and more Tractors Trailers Trucks Trucks (freight Wagons Water towers Weeders
Part XI Class No. 8 8 8 8 6 13 8 8 8 8 8 8 10 10 or 10.1 2 8 8 8 8 17 8 8 10 8 8 8
8 10 8 8 8 12 8 10 10 10 16 10 6 8
Welding equipment Well equipment Wharves Cement, steel, or stone Wood
8 8 3 6
Wind-chargers Wind-energy conversion equipment acquired beforeFebruary 22, 1994 acquired after February 21, 1994
8 34 43.1
is a limit on the amount you can include in class 3. The most you can include in class 3
e maximum rate in any year. nd up-do-date schedule.
ermit 75% of the investment to be depreciated
VII of the Income Tax Act, contact the Tax Services Office.