Collapse of agribusiness managed investment schemes: participant information

How early termination of your agribusiness (forestry) MIS may affect deductions

Division 394 contains specific rules that govern your entitlement to retain these deductions in some circumstances:

• if you are an initial investor you must generally hold your interest in the MIS for at least four years
• the forestry manager must establish a plantation within 18 months of the agribusiness (forestry) MIS first receiving payments.

For more information, refer to subsection 394-10(5A) of the Income Tax Assessment Act 1997.

If you cease holding your interest within four years but all other requirements for the forestry deductions have been met, you are still entitled to your deductions provided that the cessation was due to factors that are beyond your control.

If your agribusiness (forestry) MIS does not satisfy the 18 month establishment rule, then you will not be entitled to retain your deductions under Division 394. However, you may still be entitled to make a claim for deductions under general provisions if your activities constitute the carrying on of a business. For more information, refer to Taxation Determination TD 2010/15.

Sections within Early termination of an agribusiness (forestry) managed investment scheme

• What is an agribusiness (forestry) MIS?
• How do you know if your agribusiness (forestry) MIS has been terminated early?
• What happens to the product ruling if my interest is terminated early?
• Non Division 394 Agribusiness (forestry) MIS
• How does capital gains tax (CGT) apply?
• Business income
• What happens to deductions I have claimed in earlier years?
• Non-commercial loss (NCL) rules
• Division 394 forestry managed investment schemes
• How early termination of your agribusiness (forestry) MIS may affect deductions
• Interest deductions
• Non commercial loss (NCL) rules
• How to treat a payment from a Division 394 (forestry) MIS on its winding up