Equity FAQs
June 20, 2022

You’re not just a Co-op member, you’re an owner.
Our profits are your profits.

Being a part of a co-operative and supporting that co-operative with your purchases keeps profits in our community. Your daily purchases create local jobs, support local charitable organizations, and the remaining profits are returned to members like you, right here in our local community.

At the end of each fiscal year, your elected Board of Directors reviews our financial statements and determines the percentages to be allocated on our member's purchases. They also determine what portion of that allocation will be paid to members as cash, and what portion will be distributed as member equity. The remaining profit is maintained by the Co-op in general reserves for future growth and sustainability.

Our profits are allocated back to you based on your purchases across all of our locations and all eligible products, so the more you shop Co-op, the more it pays!

Pembina West Co-op is committed to the communities we serve. Each year your Co-op has supports more than 60 local community groups who are making a difference through youth sports, caring for our seniors, developing youth in agriculture, fostering the arts, ensuring greater food security, supporting mental wellness, and more. Our total impact through donations, sponsorships, events, and direct fundraising efforts was over $135,000 in 2022.

When you support the Co-op, you are supporting your community, now and for the future.

We thank you for your continued support.

DID YOU KNOW? Equity allocations are reviewed and calculated each year based on the previous year's financial statements and with the long-term interests of the Co-op and Co-op members in mind. Rates of allocation change annually, and the amount allocated back to each member reflects their purchases as well as allocation percentages. 

Q: Why are there different allocation percentages for different commodities?

A: It is common for Co-ops to allocate different percentages on different commodities. Different types of purchases may receive a different rate of allocation reflecting the profit made on those commodities. For example, profit margins on food are
lower than on fuel. Just like you are a member and owner in Pembina West Co-op, we are members of Federated Co-op. We also receive different rates of allocation on different commodities, and that affects our profits on those types of purchases.

Q: What is equity?

A: Your member equity is the long term investment that you make in your Co-op as an owner. Your equity account starts with a $10.00 balance, the cost of purchasing your membership. As you earn patronage allocations each year, a portion is saved in your member equity account, and this investment allows your Co-op to grow and provide better services for you and your community.

Q: Do I have to pay taxes on this?

A: Tax is automatically remitted on your behalf each year when equity is allocated. If your allocation is under $100, there is no tax deducted or owed, and there will be no T4A sent the following year. For personal purchases, you don’t need to
claim your allocation as income, but you do claim any taxes we’ve remitted on your behalf, which would then be deducted from your tax owing. When you withdraw equity, there are no taxes due, as they have already been paid in the years that the equity was allocated.

Q: When do I get to cash in on my equity?

A: At Pembina West Co-op, your equity account continues to grow until you reach 70 years of age. At that time, you can apply to withdraw your equity, while continuing to enjoy the benefits of membership. We keep the $10.00 share value in your member equity, and write you a cheque for the difference. This age is set by our local Co-op’s bylaws, as enacted by our members. For corporate accounts, the equity continues to grow until the company is dissolved.

Q: How are dividends calculated?

A: Allocations are set each year based on the Co-op’s profitability, cash flow position, and with long-term sustainability in mind. Once the year end financials are completed, the Board of Directors determines how much cash is available to make a dividend payment, and how much equity should be retained for the Co-op’s growth, following our Co-op bylaws. Once the percentage rates have been determined, your purchases are tallied and receive the relevant % back as dividends.