Special Deductions & Tax Support for Primary Producers Affected by Drought & Natural Disasters
The Australian Government has introduced a number of taxation measures and concessions available for drought–affected primary producers.
As part of the 2019-20 Budget, the instant asset write-off increased from $25,000 to $30,000, and the business turnover threshold increased from $10 million to $50 million. From these increases, small businesses including primary producers, are able to claim a full deduction for business assets in the year they are purchased and/or installed.
Primary producers may be able to immediately deduct (rather than depreciate) the cost of fodder storage assets, making it easier for them to invest in and stockpile fodder. Primary producers who store fodder for sale may also be entitled to this deduction.
Primary producer can re-commence income tax averaging. Tax averaging enables you to even out your income and tax payable over a maximum of five years to allow for good and bad income years.
The ATO can offer drought affected primary producers: more time to pay, waiving penalties or interest charged at the time of the drought, interest free payment plans, adjusting PAYG instalments and tax incentives.
For more on this topic visit the Australian Government’s Department of Agriculture website.
If you would like to discuss this please contact our office.