Opteon’s team of agribusiness and rural property valuers provide valuation and consultancy advice for a diverse range of rural and regional property assets. Our team have experience in agriculture and understand land management practices. This knowledge extends to expert property advice on all types and scale of rural property including dryland cropping, grazing, irrigation, water licenses and other specialised assets. This includes a wide range of intensive livestock and horticultural properties for broad-acre cropping, grazing, dairy and a wide range of intensive agriculture and horticultural properties for major corporate clients and lending institutions. To visit Opteon’s website >> click here.
Our certified & experienced agribusiness & rural property valuers & advisors are located across all major metropolitan & regional centres. To request a valuation quote please >> click here.
Telephone: 1300 40 50 60
737 Bourke Street
Docklands VIC 3008
Did you know you can claim immediate deductions for water facilities, such as dams, bores, windmills, fencing, hay sheds and even items like grain storage bins?
Many farmers and agribusiness owners may be missing out on the full benefits of asset depreciation deductions due to lack of awareness of the rules. Here is an overview of the rules regarding primary production assets, and the benefits of a tax depreciation schedule for agribusiness properties.
Depreciation deductions for most assets (e.g. buildings and equipment) can be claimed over several years under the general rules, based on the asset’s decline in value. However, there are special rules that apply to certain types of primary production assets where you may be able to claim an immediate deduction for depreciation. This includes:
This information applies to new assets. For second-hand assets, you can claim depreciation deductions under the same rules, but only if the previous owners have not already done so. Some farmers may be eligible to claim under the instant asset write-off rules for second-hand assets as a small or medium business enterprise.
Aside from the above situations for water facilities, fences and fodder storage, some businesses may be eligible for instant asset write-offs for the business portion of an asset’s cost.
Instant asset write-off can be used for multiple assets and some second-hand assets, providing the cost of each is lower than the threshold. The threshold was recently increased from $30,000 to $150,000 and applies to the end of June 2022. To meet the criteria, the asset must have been purchased by December 31, 2020. It must have been first used, or installed ready for use, between March 12, 2020 and June 30, 2021.
Businesses with a turnover of up to $5 billion (previously $500 million) may be eligible, although a $500 million turnover limit applies for second-hand assets.
Agribusiness owners often tend to focus on profitability and don’t take full advantage of available depreciation deductions. However, these deductions can substantially reduce a business’s taxable income.
The tax savings can in turn be used to improve cash flow, invest in new plant, equipment or systems, or to create a safety net to tide the business over during difficult seasons.
We’ve dealt with many cases where agribusiness owners were able to make substantial claims through primary production asset depreciation. Here are some examples:
As you can see, the rules regarding primary production depreciation are detailed and complex, and this guide certainly doesn’t cover every situation or opportunity!
At Opteon, we can help you minimise your tax bill for your rural business by preparing a tax depreciation schedule. Our tax depreciation services are risk free. This means that if after an initial review, we determine that the deductions available for your property will not cover Opteon’s fee, we will recommend that you do not proceed.
For more information on the benefits of a tax depreciation schedule for agribusiness properties, contact us via our request a quote page, or on 1800 40 50 60.
Meta description: Many farm business owners are not aware of the benefits of a tax depreciation schedule for agribusiness properties. Opteon explains how this works.