START UP: YOUR BUSINESS PLAN
Develop your business plan
It is time to put together a business plan based on your best estimates. Essential elements of a business plan include, but are not limited to, the following items:
A self-assessment of your skills, strengths and weaknesses.
A sales and marketing plan.
What and how much you will sell during the next five years.
Identification of your markets.
A projection of your profit and loss (P&L).
A cash flow projection (different from your P&L projection) that includes:
Capital needed for equipment and infrastructure purchases.
Operating capital to cover financial needs until cash flow from operations starts coming in.
Labour needs and how they will be fulfilled.
In developing your business plan it is important to make it as realistic as possible. It is recommended that professional advice be sought at this stage of your plan. This could be from other successful farmers, the Department of Agriculture, Aquaculture and Fisheries, farm business consultants or accountants trained in assisting in the development of a business plans.
Registering your farm as a business
There are a number of steps and options in registering your farm as a business at the provincial and federal level.
The major ones are as follows:
The Registered Professional Agricultural Producer (RPAP), which identifies the business as a bona fide farm, entitles the farm to certain financial discounts and allows membership into a general farm organization.
Registration of a business, unless it is a sole proprietorship. This is required of all businesses and links the business to other programs.
A Business Number. As required, including payroll deduction payments, Harmonized Sales Tax (HST) refunds, etc.
Not all businesses are required to register in New Brunswick. A sole proprietorship business is not required to register, but partnerships and corporations are required to do so. Before registering for a business number there are some important decisions that you need to make about the business:
name of the business;
location of the business;
legal structure of the business (sole proprietorship, partnership or corporation);
fiscal year-end for the business;
estimated sales for the business.
To learn more about the various options of the type of business structure to choose, and locations of the Service New Brunswick offices, visit www.pxw1.snb.ca/snb7001/e/2000/2500e_5.asp.
Registering the business name:
If you choose to operate a business under a specific business name, it is recommended that you register the name in order to protect that name for your use only. To learn more about registering a business name, visit the following link: www.pxw2.snb.ca/brs/docroot/start/landingPage.jsp.
Registering the business:
Forms and information to help with this can be obtained at any Service New Brunswick outlet or visit www.pxw1.snb.ca/snb7001/e/1000/1001e.asp.
Federal Business Number
All businesses are required by the Federal Government to register and obtain a Business Number (BN) regardless of the legal structure or ownership of the business. It is also important to note that if a business obtains a BN for a sole proprietorship this BN cannot be transferred should the legal structure change (i.e., becomes a partnership or corporation).
A new BN will have to be applied for. Once registered, a business can access whatever programs are required. Typical programs that are used by the farming community include:
HST – which allows a business to apply for a refund on all HST paid;
Payroll deduction remittance;
The following link will assist in obtaining a BN: www.canadabusiness.ca/eng/page/2730/sgc-13/.
For more information on business registration, contact the Canada Revenue Agency at 1-800-670-4357 (tollfree) or visit:
In Canada and New Brunswick, all individuals and businesses earning income are required to pay and file income tax returns on an annual basis. As a farmer, there may be some special tax considerations. It is important for new entrants to get advice from a professional, who can advise on tax matters.
Farm vehicle licence plates
Farm plates, sometimes referred to as F plates, may be purchased at any Service New Brunswick outlet. All you need to qualify is a valid RPAP card. Farm plates cost about one-half of commercial vehicle plates; however the registration of a farm plate must be for a full year, while commercial plates can be purchased by the month. Farmers may haul their own products to and from market and also haul farm products for other farms.
However, a farm-plated vehicle may not be used for commercial transportation.
Registered Professional Agricultural Producer (RPAP)
Producers can apply for a RPAP card at Service New Brunswick outlets anywhere in New Brunswick or online. Participation in this program is strictly voluntary, but participation provides access to the Fuel Tax Exemption Program and the purchase of farm vehicle licence plates commonly referred to as farm plates for farm vehicles. (see Section 6.5 for more details). For more information, visit www.pxw1.snb.ca/snb7001/e/1000/1001e.asp.
The Department of Agriculture, Aquaculture and Fisheries administers the Agricultural Producers Registration and Farm Organizations Funding Act which also provides stable funding for general farm organizations (GFO) in New Brunswick. This funding allows organizations to provide services to their members. The RPAP registration fee is based on the farm business annual gross income for the year immediately preceding. The farmer designates to which GFO he or she wishes to belong.
Currently (2017) there are two GFOs in New Brunswick, the Agricultural Alliance of New Brunswick and the National Farmers Union in New Brunswick. For more details, visit:
NOTE: Farm registration does not follow the government financial year (April-March). It runs from February 1st through January 31st. First-time farmers can register before or after they have begun to earn income from their farm, (if prior to commencing farming, a business plan needs to be presented to the RPAP registrar). For more information, contact the Registrar of Farms at 506-444-2848.
Obtaining your Fuel Tax Exemption Card
While applying for your RPAP card, you may also request your Farmer Purchaser’s Permit, which allows you to buy tax free diesel fuel at the point of purchase. You must pay the fuel tax on gasoline at the point of purchase.
An application to have this fuel tax refunded is possible if the gas was used on the farm or if gas or diesel was used in farm-plated vehicles used for farm production. New Brunswick fuel tax laws administered by the Department of Finance allow for all farm production activities to be eligible for the exemption. This includes the fuel used in farm-plated vehicles if the activity is production related.
Activities related to the delivery or the marketing of agricultural products are not eligible for a refund. The following link gives you the fuel tax refund application: www.pxw1.snb.ca/snb7001/e/1000/CSS-FOL-GMF-37E.pdf.