AS we head toward tax time, fruit and vegetable growers across the country are starting to think seriously about preparing for end of financial year.
A healthy pile of receipts is likely stored up ready for the end of year trip to the accountant.
Along with the receipts will be a multitude of questions about primary producer provisions, deductions, concessions, offsets, farm management deposit schemes, and the valuation of plants and vines that growers face.
Perhaps among the best news for many growers is the extension of the instant asset write-off threshold of $20,000 for small businesses.
Last year, in a move with farmers at the forefront, the Australian Tax Office announced it would extend the threshold of $20,000 for the write-off scheme though to June 30 2018.
This means that growers may be eligible for major tax incentives if they install new technology and equipment before the end of the financial year.
The instant asset write-off makes for a particularly compelling incentive to take advantage of this financial year, as the threshold is anticipated to drop to assets that cost less than $1000 as of July 1 2018.
How to take advantage
IN addition to purchasing a new ute, machinery or an iPad for use in the field, many growers are planning to use the instant asset write-off scheme to invest in new agriculture technology that can give them access to precise on-farm data and predictions to help them make decisions like when to plant, harvest, irrigate, feed and protect their crops.
To take advantage of the instant asset write-off, there are a few initial steps to take:
1. Get to know the instant asset write-off scheme
If growers purchase and install an asset that costs less than $20,000, they may be able to immediately deduct the business portion of that asset from their tax return.
This means, if a piece of equipment is purchased for $19,999 in the 2017-18 financial year, growers may be able to reduce their taxable income (and therefore, tax payable) for the same financial year by $19,999.
2. Determine your eligibility
In order to be eligible for the write-off, growers must have a turnover of less than $10 million for the year in which the tax deduction is being claimed (i.e the 2017-2018 financial year).
The asset must also be first used or installed and ready for use in the 2017-2018 financial year.
3. Look at your planned purchase or purchases
Importantly for many growers, there is no limit to the number of assets that can be claimed under the instant asset write-off.
It can be applied to each asset less than $20,000, regardless of how many assets fall into that category.
4. Consider investing in microclimate prediction technology
The Yield’s Sensing+ solution uses sensors to measure, record and interpret microclimate data from around the farm and applies data science and artificial intelligence to predict growing conditions.
5. Speak to your accountant
Finally, and most importantly, with the tax deadline looming, growers are urged to speak to their accountant or financial advisor soon to confirm their eligibility and ensure installation of new technology and equipment before the end of financial year.
The Yield is an Australian agricultural technology company on a mission to transform food and farming practices with scalable digital technology.
The Yield uses Internet of Things (IoT), data science and artificial intelligence (AI) to power its technology which is being used to solve real challenges at farm level and throughout the food chain.
The company works with some global giants including Bosch, KPMG and AgFunder.
More information at www.theyield.com
Felicity Turner is the general manager, customer experience at The Yield.
- Copy supplied by The Yield.