Farm management deposits scheme

Account terms

Your deposit can be held in accounts of any type, including at-call accounts. To qualify for the tax deduction, your deposit must remain in the account for 12 months from the date of deposit, except in certain circumstances.

Your FMD provider cannot at any time deduct any administration fee or other amount required from your deposit amount.

Your rights as a depositor cannot be transferred, and the deposit itself cannot be encumbered. This means you cannot:

• use the deposit as security for any amount you owe to the FMD provider or any other person
• use the deposit as a mortgage offset account to reduce your liability to pay interest on other debts to the FMD provider
• reinvest the interest or other earnings on your deposit as a FMD with the FMD provider without the earnings being paid to you first.

Transferring your deposit to another FMD provider is not classified as receiving a repayment - this means you will not be assessed on the amount you transfer, and the transfer will not allow you to claim an income tax deduction.

Transfers of deposits between FMD providers must be made electronically.

If you immediately reinvest a deposit with the same FMD provider, or extend the term of a FMD, the reinvestment or extension does not involve the repayment or the making of a new FMD.

Sections within Making deposits

• Where to make deposits
• Setting up an account
• Merging multiple deposits
• Account terms