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HomeMy WebLinkAboutThe Brussels Post, 1972-12-27, Page 8MR. MERCHANT Here are TEN solid facts you should consider in planning your ADVERTJSING ESTABLISHED 1872 Brusselss pot BRUSSELS ONTARIO Married 50 years ?? Are you having a 90th birthday ?? We are anxious to carry a story with a picture of your 50th wedding anniversary and 'of your 90th birthday. So that some arrangements can be made we ask your co-operation in advising us as far in advance as possible of such events While, other than in exceptional circum- stances, we will not be able to use pictures of wedding anniversaries of less' than 50 years, we do want a story of such anni- versaries. Please forward details as soon as the event is held.' ESTABLISHED Utz • BRUSSELS ONTARIO Phone. e874641 at the Post Publishing • House - ll—,THE BRUSSELSPOST, DECEMBER 27, 1972 Minister outlines changes in. farm.,assest regulations Farmers with, assets pur-, Phased prier to 1972-.are strongly advised to continue with the straight-line depredation. ,method for all assets presently being depreciated by that method. The basic reason for recom- mending this course of action is the following: When the diminish- ing balance method (Part XI) is being used, all depreciable items are la'mped together in various classes according to the maxi= mum, rates of depreciation allowed by the tax laws. If all machines of a certain class are sold, and if the returns' from these machines are greater than the undepreciated balance of that class, the excess is considered a capital recovery which is taxable income for the year in which it is received. Alternat- ively, when an asset that has been depreciated under Part XVII (the straight-line method) is sold, the returns from the sale of this asset are tax free. Non-Arms Length Transfer of Machinery If machinery is transferred from father to son, it is trans- ferred at fair market value. The son would of course be using Part XI method regardless of the method used previously by father. If the machinery is trans- ferred from a father to a partner- ship or corporation, it is trans- ferred at the fair market value. On many smaller farms this is greater than book value. If the father has been using Part XVII there will be no recapture. If he has been using Part XI, the difference between book value and fair market value will be recapture of depreciation. On some large farms where machinery is used to cover many acres, the, book value may be higher than the fair market value. If father has been using part XI there would'be a "terminal loss" to balance against income. Should father continue owning machinery that is now on straight-line depreciation? Maybe. When the time comes to trade in the old machine, father and son could both go to the dealer. Father would receive an allowance for his old machine. Son would buy the machine for the new price. This will allow him to take capital cost allow- ance on the full price. Father could make a gift to son. It will not be subject to gift tax unless it goes over the $2,000 maxi- mum gift exemption between indi- viduals in any one year. • BY J. J, HagartY Ontario. Ministry of Agriculture and Feed, Stratford, Many farmers are coiur- Xldering changes is ownership of fartn assets, The new tax laws and the resulting discussion.ave encouraged PeOPle to ask questions about their own Situa- tion. One good thing about the tax changes is that it encottrageS us to think, plan and make some decisions. Hopefully these plans will benefit all members of the family. Separation of Principal Residence and, One Acre of Land This has been recommended by some when buildings are in- cluded in a partnership and/or corporation. Some doubt has been cast on the advisability of this technique. (1) the zoning by-laws 'may not allow it (2) loaning agencies such as. Farm Credit Corporation may not allow it (3) depreciation of the house will not be taken as an expense (4) local taxes might be high- er due to separate assess- ments. However, there may be cases where houses should be kept out of the corporation to take advan- tage of capital gains exemptions on principal residences. e.g. Where 3 brothers live in separ- ate homes that would otherwise be owned by the corporation. The brothers will then not have to pay rent for the houses (which is income to the corporation and a non-deductible expense personally). Transfer of Depreciable Assets The new tax regulations dic- tate that all depreciable assets purchased after Decernber 31st, 1971 be depreciated using the diminishing balance procedure (Part :!CI), With the new Income Tax Act, straight-line deprecia- tion (Part XVII) is being phased out. All depreciable assets which were purchased prior to 1972 and are now being depreciated under Part XVII (the straight- line method), however, may be left under the straight-line sys- tem. Machinery and buildings sold or rented to an individual, partnership or corporation will have to be depreciated on the declining balance basis (Part XI). Most of these assets are on straight-line depreciation (Part XVII) now, 1 This newspaper is an advertising medium that is WANT- ED - it is sought after 'and paid for, and advertising in it is not an intruder • in the home. 2 This 'newspaper's circulation is CONCENTRATED in this trading area. 3 The newspaper provides PENETRATION in the prim- ary market by reaching virtually every family or cus- tomer in that market. 4 People read newspaper ads when they are ready to make a decision and to act - WHEN THEY'RE READY TO BUY. The newspaper is convenient; it may be consulted at a time most CONVENIENT to' every member of 'the fam- ily. 6 People LIKE TO READ NEWSPAPER ADVERTISE- MENTS - surveys show 85 per cent of the people want their newspaper to contain advertising. 7 Every issue of every newspaper contains INFORMA- TION AND PICTURES of interest to every member of the family. 8 Newspaper reading is a habit and a part of peoples routine. 9 The printed word is MORE RELIABLE THAN the spoken word and rt cannot be refuted because it is easily available for re-checking. More accurate information is obtained by reading than by listening. 10 The newspaper is' ideal for comparison - items in a news- paper may be easily compared with items in other news- paper ads. THE MOST EFFECTIVE AND MOST ECONOMICAL WAY TO PROMOTE BUSINESS IS THROUGH NEWSPAPER ADVERTISING