With the end of the financial year fast approaching, there are some important considerations to keep in mind when reviewing your tax planning strategies for 2025. 

Farm Management Deposits (FMD)

FMDs are a powerful tax deferral strategy for eligible primary producers. A few points to consider include the following:

• Funds must be held for at least 12 months to retain the deduction.
• Deposits are fully tax-deductible in the year made.
• The withdrawals are assessable income in the year they’re taken out.

So, with adequate planning, we can help you identify:

• If depositing into a FMD before 30 June year end will save you tax, and how much
• Or whether it may be a good time to withdraw FMD’s. If you are having a loss year or experiencing a downturn, it may be good timing to pull money out of FMD’s, minimising your tax on this income and improving your cashflow.

Prepaying Deductible Expenses

If your taxable income is tracking high, an effective tool is prepaying deductible expenses. Under ATO rules, primary producers can prepay up to 12 months of eligible expenses and claim the deduction this year, as long as the services are provided within that 12-month period.

Fencing, Water Facilities and Fodder Storage Assets

If you are a Small Business Entity (SBE) with a turnover under 10m you are eligible to use the simplified depreciation rules.

This means that a SBE can choose to claim deductions under the simplified depreciation rules for certain depreciating assets used in the course of carrying on a business of primary production. The choice is available for water facilities, fencing assets, fodder storage assets and depreciating assets relating to land care operations, electricity connections and phone lines.

Please contact our office for specific advice or assistance with any Tax queries. T: 03 5571 0111 E: reception@coggergurry.com.au or make an online enquiry www.coggergurry.com.au/coggergurry_contact_us