Farmers' 2021 federal income tax returns delayed due to Return of Fuel Charge Proceeds tax credit.

Shared on behalf of the Famers' Advocate Office.

A delay for 2021 income tax returns for agricultural producers who have claimed the Return of Fuel Charge Proceeds tax credit in their federal income tax applications is expected. There is no definite timeframe for processing.

Canada Revenue Agency (CRA) cannot process 2021 income tax files claiming this tax credit until Bill C-8 receives Royal Assent.

The Return of Fuel Charge Proceeds tax credit is a means for the federal government to return a portion of the federal carbon polluting pricing system’s fuel charge proceeds to agricultural producers in the four provinces that did not implement their own carbon pricing system: Ontario, Manitoba, Saskatchewan and Alberta.

The tax credit is included in Bill C-8 (An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures) which implements various parts of the federal government’s 2021 Fall Economic Statement.

There is no direct action that the Farmers’ Advocate Office or the Government of Alberta can take to remedy this issue. This is a matter of federal legislation approval and implementation.

Tax preparation software for the 2021 tax season included the addition of the Return of Fuel Charge Proceeds to Farmers Tax Credit. CRA began sending warnings of potential delays to tax preparers in February 2022. As of May 17, 2022, the bill is in consideration with the Standing Senate Committee on National Finance.

If you have questions related to this refundable tax credit, refer to: Contact the Canada Revenue Agency. For more information on this issue visit the Canada Revenue Agency website.