As you know, the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) has approved the requested increase to the mandatory provincial check-off fee by $1.00 effective November 1st, 2014. Check-off will be increased from $3.00 to $4.00. To learn more click here.
There are many producers who would like to know exactly what their responsibilities are towards checkoff. Checkoff is the $4.00 collected per head of cattle sold that is remitted to the Beef Farmers of Ontario (BFO). Revenue generated from checkoff is used towards such activities as:
- promotion and marketing campaigns
- new product development
- government lobbying
- producer education
- industry awareness
- food safety
- consumer education and many other activities related to the promotion of beef and veal.
Many producers are unclear as to when checkoff applies to their particular situation. For example, did you know that the dairy producer is responsible for remitting checkoff on the bull calves that they sell to veal producers? Because these calves are going into beef production and not milk production, they are subject to the checkoff, and therefore are obligated to remit checkoff to the BFO.
These are some of the most frequently asked questions from producers. The answers are derived directly from the Beef Cattle Marketing Act:
When should I pay checkoff on my cattle?
The Beef Cattle Marketing Act and regulations governing license fees (checkoff) goes into effect every time cattle are sold. Purebred sales and private treaty sales involving beef cattle, dairy cows for slaughter as well as bob calves and veal calves are subject to checkoff.
The regulation requires that auction market operators, packing plant operators and livestock dealers deduct $4.00 per head from sale proceeds and remit all money collected to the Beef Farmers of Ontario. The SELLER is also responsible under the Act and must remit the $2.25 per head in a private treaty transaction or a transaction where the buyer fails to make the deduction.
Checkoff dollars must be remitted by the 15th of the month or quarter following sale. All sale transactions by market operators, packing plants, livestock dealers or producers are subject to audit to ensure compliance with the checkoff legislation. License Fee (checkoff) Deduction Remittance Report Forms and cheques should be mailed to the Beef Farmers of Ontario.
What are the penalties for persons not complying with the obligations of the Act and regulation?
The liable person, upon conviction, is subject to a fine of up to $2,000.
Who has to pay the checkoff?
Every cattle seller has an obligation to pay the $4.00/head checkoff. Cull dairy cows, bob calves and veal calves included. Exemptions exist only for:
- cattle sold in a public auction sale organized where all of the cattle being sold are for the production of milk
- the seller does not reside in Ontario
Isn’t the checkoff collected only when cattle are sold for slaughter?
No. The $4.00/head checkoff is payable whenever cattle are sold, subject to the exemptions cited above.
Who is responsible for collecting the checkoff?
Both the buyer and seller are responsible. The regulation requires that auction market operators, packing plant operators and livestock dealers deduct the $4.00/head checkoff from the proceeds payable to cattle sellers. The seller is responsible for remitting the $4.00/head checkoff on cattle sold by a means other than to an auction market, packing plant or livestock dealer – this includes cattle being sold for export or in instances where the buyer who is required to deduct the checkoff has failed to do so.
How do I remit checkoff and when is payment due?
In the vast majority of cattle transactions, it is the responsibility of the buyer to deduct the $3.00/head checkoff from the proceeds payable to the cattle seller. Firms which deduct checkoff are required to remit the checkoff fees which they have deducted by the 15th day of the month or quarter following the date of transaction to the Beef Farmers of Ontario (BFO). The BFO mails checkoff remittance forms to auction markets, packing plants and livestock dealers for this purpose. A seller may remit the checkoff on private treaty transactions directly to the Beef Farmers of Ontario with a statement showing the name and address of the seller, and the number of head sold by the 15th of the month following the quarter in which the cattle were sold.
If you have any questions, or wish to report non-compliance, please contact:
Beef Farmers of Ontario
130 Malcolm Road
Guelph, Ontario N1K 1B1