Landcare and water facility tax offset
This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.
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The landcare and water facility tax offset is not available for expenditure incurred after the end of the 2000-01 income year.
However, the water facility tax offset of 30 cents in the dollar may be available in 2002-03 for one-third of the eligible expenditure you incurred in 2000-01 on facilities to conserve or convey water. The water facility tax offset is available only if you chose to claim a tax offset over three years instead of a deduction for that expenditure. The tax offset is based on one-third of the eligible expenditure and is available in the year the expenditure is incurred and in each of the next two years.
The water facility tax offset could only be chosen instead of a deduction for up to $5,000 of eligible expenditure on facilities to conserve or convey water.
To have been entitled to choose this tax offset, your taxable income in the year the expenditure was incurred (the 2000-01 year) must have been $20,000 or less after notionally deducting the amount that you would have claimed for eligible expenditure if you had not chosen the tax offset. Also the expenditure must have been incurred to conserve or convey water for use in a primary production business you conduct on land in Australia.
The landcare and water facility tax offset is a carry-forward, non-refundable tax offset. This means you can carry forward indefinitely any excess tax offset, after tax liabilities are met, to use against future income tax liabilities. Before the tax offset can be applied in a later income year, it must be successively reduced by any unused net exempt income derived in the year the tax offset arose and any subsequent income year-providing you had a taxable income in that year. The tax offset is reduced by 34 cents for each dollar of net exempt income. Under a proposed measure, the rate at which net exempt income reduces the carry forward tax offset will be changed to 30% for 2000-01 and later income years. As at 31 May 2003, this measure had not become law.
Last modified: 09 Feb 2006QC 27451