The Primary Production & New Accelerated Depreciation Rules

by Cos Schuh

For many primary producers, the bumper cattle prices are a welcome relief after years of suppressed cattle markets. If prices continue to rise or remain at current levels we expect the increase in prices to flow through to the bottom lines of producers.

If you are in a position where you can reinvest some of the profits back into your farm, it may be important to consider the recent changes to the timing of tax deductions of assets purchased by Primary producers.

Primary produces will now be able to:

1. Immediately deduct the cost of fencing and water facilities such as dams, tanks, bores, irrigation channels, pumps, water towers and windmills.

2. Depreciate over three years the cost of fodder storage assets such as silos and tanks used to store grain and other animal feed.

It may be wise to investigate the feasibility of possible investments earlier in the financial year, as some of these projects will have long lag times.

Please note these special depreciation rules for primary produces are in addition to the $20,000 accelerated depreciation tax incentive for all small businesses. We are more than happy to discuss how these rules will impact on your business, and you can make an appointment to speak to one of our specialists on 07 5482 2855.