Landing clients can be one of your biggest challenges as an accountant, and sometimes, it helps to set yourself apart from the crowd as a specialist. If you live in an area with a lot of ranchers or farmers, or if you’re thinking about relocating to the country, you may want to provide specialized services for these niches.
Understand Unique Rules for Farmers and Ranchers
The Canada Revenue Agency has all kinds of rules that only apply to farmers and ranchers. If you want to specialize in this group of clients, you need to understand the CRA’s guidelines. That way, you can help your clients lower their tax liability as much as possible. When you do that, you provide value that helps to ensure your farming and ranching clients keep coming back to you and potentially recommend your services to other people.
For example, the CRA offers taxpayers a lifetime capital gains exemption (LCGE). This applies to gains from qualifying small business corporation shares, but it also applies to gains from the sale of qualifying farming and fishing property. Note that most of the CRA’s rules that apply to farmers also apply to ranchers. As the LCGE is worth $1 million as of 2016, it can save your clients anywhere from $75,000 to $165,000. This is based on reporting half of capital gains and then applying tax rates from 15 to 33 percent.
Similarly, the agency also has special rules on deferring capital gains if your client has to sell breeding livestock due to a drought. Normally, if your clients incur a capital gain, they have to report it on that year’s tax return, but in this situation, the CRA gives your clients extra time. As long as your clients replace the breeding livestock within a certain window of time, they don’t have to worry about the capital gains.
Market Your Services to Farmers and Ranchers
Before you start marketing your services to this niche group of clients, brush up on the types of rules mentioned above. Then, consider advertising your services online in farming and ranching groups, by hanging posters in the local feed and seed, or by putting ads in small town newspapers. You may even want to offer prospective clients a free consultation. During that meeting, consider looking over their prior years’ returns and letting them know where you could have saved them money based on your specialized knowledge.
Get to Know Their Industry
You should also understand a few basics about farming and ranching. To continue with the above example, it’s easier to help your clients claim a deferral for capital gains on selling breeding livestock if you know the definition of breeding livestock. Basically, ranchers keep breeding livestock on hand that they inseminate each year so they can get a herd of cattle to sell.
Ideally, you should understand which equipment or processes are critical for your client’s business. You should also understand what affects their cash flow, payroll, equipment acquisition and disposition, and fund management. This knowledge helps you give your clients useful financial advice.
When you understand the industry, you can also help your clients identify other revenue sources. Perhaps one client may benefit by switching from a monocultural, big production business model to a polycultural farm that does sales through a community-supported-agricultural setup. And another client may benefit from renting out some of its land for guided hunts or farm-to-table dinners. To offer advice like that, you need to understand these industries and their unique challenges.
Niche specializations are just one way to set yourself apart from the competition. If working with farmers and ranchers doesn’t appeal to you, you may want to explore other niches.