Individual primary producers (whether a sole trader or partner in a partnership) may be eligible to treat certain income they receive on or after 1 July 2022 from their carbon abatement activities, as primary production income for the purposes of Farm Management Deposit Scheme and Tax Averaging arrangements. They may also be eligible if they are the beneficiary of a trust that carries on a primary production business and receives income attributable to its carbon abatement activities.
Individual primary producers who receive registered Australian Carbon Credit Units (ACCUs) from their carbon abatement activities may also be eligible for a further concession. This additional concession means they are only taxed on the disposal of eligible ACCUs and are not assessed on their change in value at the end of each income year they are held.
Understand the taxation implications of Australian carbon credit units when operating as a primary producer.