The government recently announced a series of tax law changes that could benefit farmers.
Extension to 30 June 2020 and Increase of the Instant Asset Write-off
On 2 April 2019, the Treasurer, the Hon. Josh Frydenberg MP, as part of the 2019-20 Budget, announced the increase of the instant asset write-off from $25,000 to $30,000, and an increase in the small business entity business turnover threshold from $10 million to $50 million.
This measure allows eligible small businesses, including those in primary production, to continue claiming a full deduction for business assets in the year they are installed, helping those businesses to improve their planning and cash flows.
Turnover Threshold to access the Small Business Entity Concesions
Prior to 29 January 2019 $20,000 $10 million
29 January to prior to 7:30 pm, 2 April 2019 $25,000 $10 million
From 7:30 pm, 2 April 2019 to 30 June 2020 $30,000 $50 million
Immediate deductions for fodder storage assets
Primary producers may be able to immediately deduct (rather than depreciate over three years) the cost of fodder storage assets, such as silos and hay sheds used to store grain and other animal feed, 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.
This measure is available for fodder storage assets first used or installed ready for use on or after 19 August 2018.
Primary producers affected by drought and natural disasters
The Australian Taxation Office can help people affected by drought and other natural disasters with:
•more time to pay
•waiving penalties or interest charged at a time you were affected by drought
•payment plans with interest free periods
•adjusting pay as you go (PAYG) instalments to better suit your circumstances
•tax incentives for primary producers.