Tax wiki
s. 31
PART I — Income Tax · DIVISION B — Computation of Income · SUBDIVISION B — Income or Loss from a Business or Property · Special Cases
Restricted farm loss
Not yet annotated · Text current to 2026-06-21 · section last amended 2013-12-12
Current text
If a taxpayer’s chief source of income for a taxation year is neither farming nor a combination of farming and some other source of income that is a subordinate source of income for the taxpayer, then for the purposes of sections 3 and 111 the taxpayer’s loss, if any, for the year from all farming businesses carried on by the taxpayer is deemed to be the total of
the lesser of
the amount by which the total of the taxpayer’s losses for the year, determined without reference to this section and before making any deduction under section 37, from all farming businesses carried on by the taxpayer exceeds the total of the taxpayer’s incomes for the year, so determined from all such businesses, and
$2,500 plus the lesser of
1/2 of the amount by which the amount determined under subparagraph 31(1)(a)(i) exceeds $2,500, and
$15,000, and
the amount, if any, by which
the amount that would be determined under subparagraph (a)(i) if it were read without reference to “and before making any deduction under section 37”,
exceeds
the amount determined under subparagraph 31(1)(a)(i).
Restricted farm loss
(1.1)For the purposes of this Act, a taxpayer’s “restricted farm loss” for a taxation year is the amount, if any, by which
the amount determined under subparagraph 31(1)(a)(i) in respect of the taxpayer for the year
exceeds
the total of the amount determined under subparagraph 31(1)(a)(ii) in respect of the taxpayer for the year and all amounts each of which is an amount by which the taxpayer’s restricted farm loss for the year is required to be reduced because of section 80.
Farming and manufacturing or processing
(2)Subsection (1) does not apply to a taxpayer for a taxation year if the taxpayer’s chief source of income for the year is a combination of farming and manufacturing or processing in Canada of goods for sale and all or substantially all output from all farming businesses carried on by the taxpayer is used in the manufacturing or processing.
Source: Justice Laws Website. Not an official version.
Historic text
Immediately preceding version, in force from 2004-08-31 to 2013-12-11:
Show the text in force 2004-08-31 to 2013-12-11
Loss from farming where chief source of income not farming
31 (1) Where a taxpayer’s chief source of income for a taxation year is neither farming nor a combination of farming and some other source of income, for the purposes of sections 3 and 111 the taxpayer’s loss, if any, for the year from all farming businesses carried on by the taxpayer shall be deemed to be the total of
(a) the lesser of
(i) the amount by which the total of the taxpayer’s losses for the year, determined without reference to this section and before making any deduction under section 37 or 37.1, from all farming businesses carried on by the taxpayer exceeds the total of the taxpayer’s incomes for the year, so determined from all such businesses, and
(ii) $2,500 plus the lesser of
(A) 1/2 of the amount by which the amount determined under subparagraph 31(1)(a)(i) exceeds $2,500, and
(B) $6,250, and
(b) the amount, if any, by which
(i) the amount that would be determined under subparagraph 31(1)(a)(i) if it were read as though the words “and before making any deduction under section 37 or 37.1” were deleted,
exceeds
(ii) the amount determined under subparagraph 31(1)(a)(i).
Restricted farm loss
(1.1) For the purposes of this Act, a taxpayer’s “restricted farm loss” for a taxation year is the amount, if any, by which
(a) the amount determined under subparagraph 31(1)(a)(i) in respect of the taxpayer for the year
exceeds
(b) the total of the amount determined under subparagraph 31(1)(a)(ii) in respect of the taxpayer for the year and all amounts each of which is an amount by which the taxpayer’s restricted farm loss for the year is required to be reduced because of section 80.
Determination by Minister
(2) For the purpose of this section, the Minister may determine that a taxpayer’s chief source of income for a taxation year is neither farming nor a combination of farming and some other source of income.
- [NOTE: Application provisions are not included in the consolidated text
- see relevant amending Acts and regulations.]
- R.S., 1985, c. 1 (5th Supp.), s. 31
- 1995, c. 21, s. 8
Earlier versions: Justice Laws point-in-time versions of the Act (from 31 August 2004), and CanLII (under “Versions”). On Justice Laws, each version of section 31 links to the one before it.
Enacting and amending legislation
- R.S., 1985, c. 1 (5th Supp.), s. 31; 1995, c. 21, s. 8; 2013, c. 40, s. 14
Text before 2004 is found in the annual Statutes of Canada cited above. Application and coming-into-force provisions are not part of the consolidation; see the amending Acts.
Cross-references
Citation
Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.), s. 31.