Farmers welcome legislative remedy for farm trusts

The National Farmers’ Federation (NFF) has welcomed the legislative remedy regarding primary producer trusts tabled in Parliament yesterday within Tax Laws Amendment (2011 Measures No. 5) Bill 2011.
NFF President Jock Laurie said the legislation will ensure that farm businesses operating under trust arrangements will not be unintentionally disadvantaged.
“The High Court ruling in the Bamford case last year had consequences for the way that primary production trusts are able to operate,” Mr Laurie said.
“As a result, beneficiaries of primary production trusts would no longer be deemed to be primary producers if the trust incurred a loss, meaning that they would no longer be able to access tax averaging benefits or farm management deposits.
“This was of considerable concern to Australian farmers, many of whom operate under a trust arrangement.
“Trusts are fundamental small business structures in Australia that can be extremely helpful in the management of family owned and operated businesses, like family farms. Farm trusts have been put in place to protect assets, enable inter-generational transfer of assets and distribute income to beneficiaries in an efficient and flexible manner.
“Today’s legislation dealing with this issue has addressed our concerns resulting from the Bamford High Court case, and the Government deserves credit for listening to industry feedback.
“It is vital for this issue to be put to rest before the end of the financial year when the 2010-11 financial year accounts are lodged,” Mr Laurie said.