Primary producers

If you're a primary producer, special tax concessions may affect which amounts you need to include in your assessable business income for an income year.

Examples of primary production businesses include farming, fishing and aquaculture businesses.

To use the special concessions for primary producers, you must meet our definition of running a business of primary production, which considers the size or scale of your business and its profitability.

Special tax concessions

There are special tax rules that may apply to your primary production income. These include concessions for:

  • profit from the forced disposal or death of livestock
  • insurance recoveries for losing livestock or for loss of trees by fire
  • selling two wool clips in an income year because of an early shearing caused by drought, fire or flood
  • averaging your income and the tax you are liable to pay over five years to allow for good and bad years
  • deposits to the Farm Management Deposits scheme that allow you to defer income to a later year.

The special concessions also affect when you have to pay your income tax, as you may be able to make two pay as you go (PAYG) instalments each year, instead of four. We will send you a letter if you are eligible for this option.

Primary producers operating as an individual or in partnership can also benefit from exceptions to the non-commercial losses rules, which would otherwise restrict you from offsetting losses for a non-commercial business activity against your other assessable income. Those restrictions don’t apply if your income from other sources (excluding net capital gains) is less than $40,000.

See also:

Last modified: 13 Mar 2015QC 44451