Show download pdf controls
  • Primary production activities

    A primary producer is an individual, partnership, trust or company operating a primary production business if they undertake:

    Operating a business

    You need to consider various indicators before you decide if your activity is a business of primary production. To completely understand whether you are undertaking a business you should carefully read Taxation Ruling TR 97/11 Income tax: am I carrying on a business of primary production.

    You are not operating a business if the activity is better described as a hobby, a form of recreation or a sporting activity.

    Plant or animal cultivation

    Plant and animal cultivation includes:

    • cultivating or propagating plants, fungi or their products or parts (including seeds, spores, bulbs and similar things) in any physical environment
    • maintaining animals for the purpose of selling them or their bodily produce, including natural increase
    • manufacturing dairy produce from raw material that you produced.

    Fishing or pearling

    Fishing and pearling includes conducting operations relating directly to:

    • taking or catching fish, turtles, dugong, bêche-de-mer, crustaceans or aquatic molluscs
    • taking or culturing pearls or pearl shell.

    Tree farming or felling

    Tree farming and felling includes:

    • planting or tending trees in a plantation or forest that are intended to be felled
    • felling trees in a plantation or forest
    • transporting trees or parts of trees that you felled in a plantation or forest to the place    
      • where they are first to be milled or processed
      • from which they are to be transported to the place where they are first to be milled or processed.
       

    If you are operating a business of establishing trees for the purpose of carbon sequestration (carbon sink forests), you will be eligible for carbon sink forest deductions.

    See also:

    Beneficiaries of primary production trusts

    If you are the beneficiary of a primary production trust that has made a loss, you may be in a business of primary production if:

    • the trustee has nominated you as a chosen beneficiary
    • you are the beneficiary of a fixed trust.
    Last modified: 18 May 2018QC 42299