What is Equity? How Does it Work?
By holding equity in Clearview Co-op, you are a part owner. Each time you purchase petroleum products and give your membership number your purchases are recorded. At the end of the fiscal year, a portion of your purchases may be returned in the form of an equity allocation (share dividends). The more you purchase, the more you receive in equity. In addition, the Board may buy back a portion of your total equity (share redemption). This amount becomes the cash payment to you, a member-owner.
You paid a percentage of my equity and allocations, what happens to the rest?
The remainder of the equity remains in your share account with Clearview Co-op. Repayments made in the future will then include a percentage of the equity in your share account and a percentage of the current year’s patronage allocations.
When can I get of my Equity paid out?
Provisions for payments of equity are made for:
• Members over 65 years of age
• Members who move out of the trading area.
An Application for Equity Withdrawal Form must be provided to Clearview Co-op in each of these instances. Forms are available on-line at clearview.crs, or can picked up at the Head Office. All requests are subject to Board approval.
Why didn’t I get a cheque?
The cash repayment is based on your equity earned in previous years as well as the current year’s allocations. A cheque is only issued when a member’s equity is more than $10, with a minimum cheque amount of $10.
Why is Tax taken off?
Clearview Co-op is required to submit a minimal amount of tax to Revenue Canada. Fifteen percent of any allocation over $100 is submitted on your behalf. When filing your income tax, you are entitled to include the deduction as a tax credit (box 22 on the T4-A statement). If the petroleum was used for personal use only, the allocation (box 30 on the T4-A) does not need to be included as part of your income. If you are claiming some or all of the purchases as business expenses, then you must include an applicable portion of that allocation as income on your income tax form.
What is the GST allocation?
Clearview Co-op determines a rate of GST allocation based off of all GST applicable purchases in the fiscal year. This rate is then used with the member’s earnings (allocations) from the same year to allocate GST to the member. If you are registered for GST purposes, the portion of the GST related to business use must be included on line 104 of your next tax return. For example, if your GST allocation is $15.25 and 75% of purchases were for business use, then $11.44 (15.25x75%) must be included on line 104 of your next GST return.
What happens to a cheque if it isn’t received and deposited by the member?
Any cheques not deposited by the member go stale after 6 months. This amount is reversed back into your equity before the end of the fiscal year. When calculating future repayments, this amount will be included in your equity.