See what assistance you could get for a shed
The government has a number of different packages in place to help farmers and businesses during these uncertain times.
Instant asset tax write-off
Eligible businesses can claim an immediate deduction for the business portion of the cost of an asset, in the year the asset is first used, or installed ready for use. This is a fantastic incentive for businesses that may have been doing it tough, to upgrade or purchase new farm machinery and equipment.
The instant asset write-off can be used for:
- Multiple assets, if the cost of each individual asset is less than the relevant threshold.
- New and second-hand assets.
If you are a small business, you will need to apply the simplified depreciation rules in order to claim the instant asset write-off. It cannot be used for assets that are excluded from the rules.
The instant asset write-off eligibility criteria and threshold have changed over time. For assets first used or installed ready for use between 12 March 2020 until 30 June 2021, and purchased by 31 December 2020, the instant asset write-off criteria is:
- The threshold amount for each asset is $150,000.
- The eligibility extends to businesses with an aggregated turnover of less than $500 million.
Further to the above criteria, from 7.30pm AEDT on 6 October 2020 until 30 June 2022, temporary full expensing allows a deduction for:
- The business portion of the cost of new eligible depreciating assets for businesses with an aggregated turnover under $5 billion, or for corporate tax entities that satisfy the alternative test.
- The business portion of the cost of eligible second-hand assets for businesses with an aggregated turnover under $50 million.
- The balance of a small business pool at the end of each income year in this period for businesses with an aggregated turnover under $10 million.
For more information on the instant asset write-off including updates from the Australian Government, click here.
Want to use the instant asset write-off for a new shed? Just get in touch with the team at ABC Sheds and enquire here.
Claim an immediate tax deduction for fodder storage
If you are a primary producer, you may be entitled to claim an immediate tax deduction for capital expenses incurred on fodder storage assets.
Examples of fodder storage assets include:
- Liquid feed supplement storage tanks
- Bins for storing dried grain
- Hay sheds
- Grain storage sheds
- Above-ground bunkers.
Note that you must be a primary producer in order to claim this deduction and your deduction is limited to the capital expenses you incur for construction, manufacture, installation or acquisition. How you can claim for fodder storage will depend on when the expense incurred but most notably:
- If the expense was incurred on or after 19 August 2018, you can immediately deduct the cost in the income year you incurred it.
You can learn more about claiming an immediate deduction for fodder storage like a hay shed here.
Government-supported tax advantage
On May 12th 2015, Federal Treasurer Joe Hockey announced $70 million for farmers to encourage drought preparedness. The Government will provide an immediate tax deduction for water facilities and allow farmers to depreciate over three years capital expenditure on fodder storage assets. This was originally commencing on July 1 2016.
At the National Press Club in Canberra on May 27, Hon Barnaby Joyce, Minister for Agriculture, and the Hon Bruce Billson, Minister for Small Business confirmed the program would now be in effect from May 12 2015.
What does this mean for you?
Australian farmers can now claim a tax deduction on all capital expenditure on water facilities, fodder storage assets and fencing incurred since the 2015 Budget was handed down.
NSW GOVERNMENT Rural Assistance Authority (RAA)
For more than 30 years, the RAA has helped farm businesses and rural communities become more resilient, self-reliant and sustainable. The RAA works within the NSW Department of Primary Industries to provide funding and financial assistance to farmers.
Farm Innovation Fund
The Farm Innovation Fund is part of the NSW Government's Drought Strategy and is a long term, low-interest rate loan for NSW farmers for permanent on-farm infrastructure. The Farm Innovation Fund helps farmers to improve farm productivity, manage adverse seasonal conditions, and ensure long term sustainability.
The NSW Government has committed $1 billion to the Farm Innovation Fund under the Emergency Drought Relief Package 2019-20.
From 1 July 2019, farmers can borrow up to a maximum of $1 million per project, with a total of $1,000,000 outstanding at any one time to build on-farm infrastructure, including stock containment areas. In addition, interest charges on Farm Innovation Fund loans for the 2019-20 financial year will be waived.
Find out more and apply here.
Grants for bushfire-affected farmers
The Rural Assistance Authority is also offering a special bushfire disaster grant for eligible primary producers in impacted local government areas (LGAs). Grants of up to $75,000 are available.
Find out if you are eligible here.
Drought Assistance Fund
The NSW Government is offering $100,000 interest-free loans to primary producers to implement systems and management practices that enhance the sustainability of their farm business. The loan term is seven years with no repayments required in the first two years. The loan funds:
- The transport of stock, fodder and water.
- Genetic banking of breeding herds.
- Installation of on-farm fodder and water infrastructure.
- Activities that promote profitability and resilience as a result of the on-farm investment.
The Drought Assistance Fund is available to farmers in NSW who own and operate a farm business, for activities that demonstrate an enterprise or natural resource sustainability benefit. Learn more about this fund here.
Emergency Drought Transport Subsidy
The Emergency Drought Relief Package 2019-20 includes $106 million for Drought Transport Subsidies.
The subsidy can be applied to the cost of transporting: fodder, water to a property for stock or domestic use, stock to and from agistment, stock to sale or slaughter. For applications received from 1 July 2019, the subsidy also includes transporting of farm chemicals, fertiliser and seed to farms.
Find out more about this subsidy and see if you're eligible here.
Low interest loans
Are you needing a loan for your next shed? You may be eligible for a low interest loan through the Rural Assistance Authority.
New South Wales
The Farm Innovation Fund is an incentive-based initiative to assist farmers within New South Wales to identify and address risks to their farming enterprises, improve permanent farm infrastructure, ensure long term productivity and sustainable land use plus aiding in meeting changes to seasonal conditions.
Funding by way of a loan is available to meet the cost of carrying out permanent capital works that will have a significant beneficial impact on the land, long term profitability of the enterprise and address adverse seasonal conditions.
For more information please visit the New South Wales Rural Assistance Authority website.
The Sustainability Loan provides Queensland farmers with finance up to $1,300,000 to cover capital costs to achieve a more productive and sustainable primary production enterprise. Make your land work better for you by building fences, dams, storage facilities, improving irrigation, or establishing additional water points. Implement on-farm value adding or supply chain initiatives to ensure your enterprise continues to be successful for years to come.
For more information please visit the Queensland Rural and Industry Development Authority website.
Did you know that you could get finance from a bank for your shed? While you would still need to pay for anything that's permanent i.e. concrete slabs and piers, you may be eligible for a chattel mortgage for something classed as a demountable building like a shed.
For advice on this type of finance for a shed, it's best to talk to your bank to confirm your eligibility.