Top 5 Tax Planning Tips for Farmers
April 16, 2025
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5 Top Tax Planning Tips for Farmers For farmers expecting a profitable year this financial year, now is the time to start thinking seriously about
What Farmers Need to Know About Preparing for the End of Financial Year
As the end of the financial year (EOFY) approaches, it’s time for farmers to get their finances in order and make the most of available opportunities. Here’s what you need to know about preparing for the End of Financial Year.
1. Maximise Your Deductions
Farming businesses have access to various deductions that can help reduce taxable income. Some key deductions include:
- Immediate Asset Write-Offs – Check the current threshold for instant asset write-offs and consider purchasing necessary equipment before June 30.
- Prepaid Expenses – You may be able to claim a deduction for expenses paid in advance, such as fertiliser, chemicals, or feed.
- Repairs and Maintenance – Undertake necessary repairs on farm infrastructure and machinery before EOFY to claim deductions in this financial year.
- Farm Management Deposits (FMDs) – If you’ve had a strong financial year, consider putting money into an FMD to defer tax and smooth out income fluctuations.
2. Review Your Income and Expenses
- Defer Income Where Possible – If you’re expecting a strong income year, consider delaying the sale of livestock or grain until after June 30 to push income into the next financial year.
- Bring Forward Expenses – If you anticipate a lower income next year, it might make sense to bring forward planned expenses to claim deductions now.
- Write Off Bad Debts – Review outstanding invoices and write off any bad debts before EOFY to claim a tax deduction.
3. Superannuation Contributions
- Boost Your Super – Contributions to superannuation are tax-deductible up to the concessional cap ($30,000 for the 2024-25 financial year). Consider making contributions before EOFY to reduce taxable income and secure your future retirement.
4. Livestock and Fodder Considerations
- Livestock Valuation – Farmers can choose different methods to value livestock for tax purposes, such as market selling value or cost price. Speak with your accountant about which method suits your situation best.
- Fodder Storage Deductions – If you’ve invested in fodder storage, you may be eligible for immediate tax deductions under primary production depreciation rules.
5. Government Grants and Assistance
- Check for Grants and Rebates – There may be government support available, such as drought assistance or environmental grants. Look into what funding options could benefit your farm.
6. Meet with Your Accountant
EOFY is the ideal time to sit down with your accountant or financial adviser to:
- Review your business structure and ensure it’s tax-efficient.
- Assess your financial position and cash flow.
- Plan for the next financial year, including tax strategies and investment opportunities.
“Taking proactive steps before EOFY can make a big difference in your tax obligations and overall financial position.”
By planning ahead and making smart financial decisions, you can set yourself up for a stronger, more sustainable business in the year ahead. Find out why 2025 is the year to get prepared.
Need help with EOFY planning? Lifesolver Financial and Matt Meehan are here to guide you through the process. Book a 15-minute chat today to make sure you’re making the most of your financial opportunities.
This blog/article is general in nature and does not take into account your objectives, financial situation, or needs. You should consider whether the advice is suitable for your personal circumstances. If relevant, before making
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