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Taxation and Growing Trees

There are a variety of information sources that can assist a forest grower in working out the tax implications of growing trees. A brief summary of these is listed below. As with any taxation issue the best advice is to engage the services of an accountant.

Easy taxation guide to growing trees

This guide is published by the Queensland Department of Natural Resources and is a useful guide to the tax implications of growing trees. It is available from the Internet at www.forests.qld.au/easytaxtree/ or contact the Department of Natural Resources on 07 3896 9332.

Australian Taxation Office

The Australian taxation office has two publications that can assist tree growers. There are also tax rulings relating to forest growing. The easiest method of obtaining these is via the taxation office web site at www.ato.gov.au

Publications

The Timber industry and the new tax system
'Your farm business and the GST'

This document has a number of relevant case studies to farm forestry. These case studies provide, a worked cash book, sample GST calculations and cashflow analysis. The relevant case studies include, Timber plantation, Timber logging, and Agroforestry/ sheep/ potatoes.

Public Tax rulings

There are two taxation rulings that are considered essential reading for forest growers. These are

TR 95/6: Income tax: Primary production and forestry

TR 97/11: Income tax: Am I carrying on a business of primary production

Private tax rulings

The taxation office will provide private taxation rulings as to whether an activity is considered to be a business of afforestation and how income and expenses are treated for tax purposes.

Justin Black
January 2001