Farmers and primary producers have to deal with challenges which are not present in any other industries, including climate conditions and drought, the large cost of land and equipment, and complex exit planning.
We can help you manage the unique difficulties of the farming industry. Our farm accounting services will protect your assets while planning for the future.
We have worked with farmers and producers for our entire history of more than 40 years. We understand your industry.
We can help you with all aspects of running your farm, including cashflow and budgeting, tax planning, and sales and exit planning.
We believe in forming long-term relationships with our clients so we can help you achieve your long-term goals.
We use the latest accounting technology to make it easier than ever to manage your finances and deliver invaluable insights.
The Overall family was looking to retire and lease out their farm. We met with them to discuss the potential tax implications of their final harvest, clearing sale, and future leasing arrangements.
We developed a long-term strategy for tax planning and cashflow management. In the first year, we reduced their tax by 25 per cent. With all the strategies we put in place and plan to implement, we estimated to save them over $700,000 in tax across their lifetime.
At Liston Newton Advisory, our origins are in rural Victoria—providing accounting services to farmers, primary producers, and other rural businesses. We now have more than 40 years of experience working with the agriculture and farming industry, so we have an in-depth understanding of the challenges you face.
Our team can help with all the financial aspects of running a farm, from managing cashflows to exit planning and tax minimisation.
There are many structures available and we will look at your circumstances to advise you on the best structure for you. For farmers, we generally suggest a land/property trust since this structure can help with asset protection and succession planning.
Ceasing production and having a clearing sale is a significant event for a farmer. This generally results in higher profit from the final harvest and sale of plant and equipment with reduced expenses and potentially significant tax implications. We can help with a strategy to plan and manage this event.
This depends on whether there is a succession plan in place where the farming business is going to be transferred to the next generation. You should be cautious of having too much land in super as it can’t be used as security for future land purchases by the next generation.
If there is no succession plan for the farming operations, land being held by an SMSF can create significant tax savings when land is rented to a third party.
Normally we would encourage clients to have the best equipment available, but this greatly depends on the viability of the farming operation, including how many acres you farm. It can be useful to look at what you are currently paying to contractors versus the cost of owning the equipment yourself.
This can be a real juggling act, but we educate our clients on potential tax savings versus paying down debt. For example, do we use cash to put money in Super or Farm Management Deposits to minimise tax or do we forgo the tax savings to reduce debt? Normally it is a combination of both, depending on the client's appetite for debt. As an owner, you need to comfortable with your level of debt.
You need to create a farm exit strategy. In the final year, there is a possible scenario of having a final harvest with no cropping expenses for the next season to offset this income. You may also sell plant and equipment, livestock, take money out of Farm Management Deposits, and deal with potential capital gains tax on the sale of farming land. Without proper planning, you could have a large capital gain and the income tax levels can be very large, up to 50 per cent.
We have a long history of working with farmers and primary producers. We understand your industry and the challenges you face, so we can help you achieve your financial goals.