HVtax

02/10/2026

🌾 CANE GROWERS
Plan Ahead - Strengthen Your Tax Position
Farm Management Deposits | 2026–27

The crush season is almost over, payments are coming in, and next season's costs are already on the horizon. With sugar prices under pressure, production costs weighing on margins and the next wet season is uncertain. So the sooner Burdekin cane growers review their tax position, the better they manage working capital and plan ahead for 30 June 2027.

THE 2026 SEASON SO FAR

Production snapshot: week 15, ending 12 September 2026

Wilmar Sugar and Renewables' Burdekin production report recorded 5.38 million tonnes crushed by week 15, approximately 75% of the season's estimated crop. Weekly throughput reached 375,314 tonnes, while season-to-date commercial cane sugar (CCS) averaged 14.88. Weekly CCS reached 15.49, above budget for the week.

CANEGROWERS reportedly revised the crop estimate from 7.92 million tonnes to 7.2 million tonnes. Wilmar expected the mills to finish crushing by the end of October.

Indicative sugar prices

Kalamia Cane Growers & Kalagro's daily sugar price update dated 1 October 2026 reported the following indicative forward prices:

Season - Indicative price

2026: $584 per tonne
2027: $565 per tonne

These figures reflect the weighted average Australian-dollar price per tonne based on available ICE No. 11 sugar market prices, adjusted for administration, ex*****on and over-the-counter margin fees. They do not account for adjustments under local grower-miller pricing arrangements and are not guaranteed returns to individual growers.

*Source: Kalamia Cane Growers & Kalagro, Daily Sugar Price, 1 October 2026.

THE COST SQUEEZE

Farm profitability depends on more than tonnes harvested. Diesel, fertiliser, chemicals, irrigation, electricity, repairs, labour and finance costs all affect the cash available for household expenses, loan repayments and the next crop.

The Australian Competition and Consumer Commission reported a regional Australian average diesel price of approximately 288.9 cents per litre on 23 September 2026. The temporary fuel excise reduction that applied from 1 July to 2 August 2026 has also ended.

With input costs consuming a significant share of farm revenue, growers should review operating budgets, eligible tax concessions and fuel tax credits rather than relying on revenue alone.

WHAT ABOUT THE 2027 WET SEASON?

The Bureau of Meteorology's northern rainfall-onset outlook issued on 27 August 2026 indicated a 55–80% chance of a later-than-normal onset across northern and eastern Queensland.

This is a seasonal probability, not a prediction that every Burdekin property will experience drought. However, growers can prepare for different rainfall scenarios by reviewing irrigation requirements, expected yields, operating expenses and cash reserves.

The objective is to avoid being forced into expensive borrowing or asset sales when seasonal conditions or income are less favourable than expected.

FOUR STRATEGIES TO REVIEW BEFORE 30 JUNE 2027

1. Consider a Farm Management Deposit (FMD)

Eligible primary producers may be able to claim a deduction for qualifying FMDs and include withdrawals in assessable income in a later year. This can help manage fluctuations in farm income, but it generally defers tax rather than permanently eliminating it.

2. Plan withdrawals around projected income

Review expected farm profits, other income, marginal tax rates and primary producer income averaging before deciding when and how much to withdraw. Splitting withdrawals across years does not automatically reduce total tax. Model the potential outcomes before committing to a strategy.

3. Check the 12-month holding requirement

An FMD generally needs to remain on deposit for at least 12 months to preserve its tax benefits, subject to specific exceptions. Depositing earlier may provide flexibility, but only if the money will not be needed for essential farm operations.

4. Review fuel tax credits

Eligible business fuel use may qualify for fuel tax credits. Check the type of fuel, business activity, applicable rate and purchase records, and reconcile claims with BAS lodgements. Rates can change, and not every use of diesel qualifies. Historical claims may be possible, subject to eligibility and statutory time limits.

KEEP CASH AVAILABLE AND MODEL YOUR CASH FLOW

An FMD is not a substitute for working capital. Before depositing money, ensure sufficient funds remain available for harvesting, irrigation, fertiliser, chemicals, wages, machinery repairs, loan repayments and unexpected expenses.

A forward-looking farm financial model can help turn tax planning into better business decisions. Rather than looking only at this year's taxable income, build a rolling 12-month cash-flow forecast, updated regularly, that includes:

- Income timing: Expected cane payments, sugar pricing exposure, other farm income and the timing of receipts.
- Operating costs: Fertiliser, chemicals, diesel, irrigation, labour, harvesting and maintenance.
- Finance commitments: Loan principal and interest, equipment repayments and planned capital expenditure.
- Tax and superannuation: Expected income tax, GST/BAS obligations, PAYG instalments and employer superannuation obligations where applicable.
- Working-capital reserves: Cash required to keep the farm operating through the next production cycle, including a contingency for delayed receipts or unexpected costs.
- Scenario testing: Compare expected, lower-income and higher-cost scenarios to identify potential cash shortfalls before they occur.

Use the forecast to determine how much money is genuinely available for an FMD or other tax-planning strategy. A deposit that creates a tax deduction but leaves the farm short of cash can cause more problems than it solves.

FMD RULES EVERY GROWER SHOULD KNOW

Under the Farm Management Deposits Scheme, eligibility generally requires that the individual:
- Carries on a primary production business and meets the scheme's eligibility conditions.
- Has no more than $100,000 in taxable non-primary production income in the deposit year.
- Makes deposits of at least $1,000, subject to applicable exceptions.
- Holds no more than $800,000 in total FMDs.
- Claims no more than their taxable primary production income as an FMD deduction.

Companies and trusts cannot hold FMDs in their own right, although eligible individuals operating through partnerships or qualifying trust arrangements may be able to participate.

Interest earned on an FMD is generally assessable income. Early withdrawals can affect the deduction unless a specific exception applies. Income averaging may also affect the tax outcome when withdrawals are included in assessable income.

Eligibility and tax treatment depend on the circumstances of the individual and the deposit. Check the rules before acting.

*Source: Australian Government, Farm Management Deposits Scheme; Income Tax Assessment Act 1997, Division 393.

PLAN BEFORE THE DEADLINE

The right strategy depends on your projected taxable income, existing deductions, FMD history, business structure, debt commitments and expected cash requirements.

At HV Tax, I help primary producers understand their tax position, assess relevant concessions and plan ahead with practical tax and business advisory support. This includes reviewing projected income, assessing potential FMD contributions and working through cash-flow scenarios so tax decisions support the farm's broader financial position.

An FMD is one option, not a solution for every grower. The aim is to make informed decisions that balance tax outcomes, liquidity and the next season's operating requirements.

Contact me to review your tax position and cash-flow plan before 30 June 2027.

Harry Vo CA
HV Tax
Phone: 0411 224 011
Email: [email protected]

Disclaimer: General information only, current as at 2 October 2026. This article does not constitute personal tax, financial product or investment advice. Tax outcomes depend on individual circumstances. Confirm applicable legislation, rates and concessions before acting.

25/09/2026

12/09/2026

Does the new 30% trust tax mean you should restructure?
Yes and no.

Treasury's exposure draft on the 30% minimum tax for discretionary trusts is out, and many business owners with trust structures may ask the same question: should I restructure?

The honest answer: it depends entirely on your numbers.

From 1 July 2028 (subject to legislation being enacted), most discretionary trusts will face a 30% floor on trust income. But that is not the only path. Trustees will also be able to:

- Elect into a fixed-distribution regime so there is no restructure required, or
- Use a time-limited CGT roll-over to move assets into a company or fixed trust.

None of these is automatically your answer. Here is the trade-off in a nutshell:

✅ Do nothing: Trustee will pay the 30% floor on distribution. No cost, no change, full flexibility retained. Right for families who value discretion for succession and asset protection more than the rate saved.

✅ Elect excluded election trust (EET): Trust locks in fixed distribution percentages. No stamp duty, no asset transfer. Right for families comfortable trading away yearly flexibility.

✅ Restructure: Trust can move assets into a company or fixed trust via the roll-over relief. This will come with advice, legal and compliance costs, plus state duty and financing consents the federal relief doesn't cover. Right when the numbers clearly support it, or there is a clear and independent commercial reason to change structure.

For many families, a trust's real value may not be the tax rate, but the flexibility to protect assets and plan succession as circumstances change. That value does not disappear because of this measure. It is simply a cost worth weighing against what restructuring would actually save you.

The bottom line: Do not let anyone tell you restructuring is compulsory or that doing nothing is always wrong. Run the numbers for your own structure first.

Submissions on the exposure draft close 18 September 2026. If you are wondering where your trust sits, reach out for a review to walk through it.

Disclaimer: General information only.

20/08/2026

The 30% minimum tax on discretionary trusts isn't just a rate change but it's a structural shift.

I recently completed postgraduate research (UNSW, Taxation of Commercial Structures, TABL5582) on the proposed 30% trustee-level minimum tax, and the interaction with Division 7A, s100A, CGT and trust restructuring throws up more complexity than the headline rate suggests.

Three issues stood out most:

1️⃣ Corporate beneficiaries face effective double taxation — no offset applies, pushing combined tax toward 60%.

2️⃣ The non-refundable offset can raise a family's total tax where beneficiaries are on lower marginal rates.

3️⃣ Federal CGT relief doesn't clear state transfer duty, financing covenants, or trust deed restrictions.

For family groups: don't wait for the legislation or the rollover deadline. Trust deeds, financing arrangements and succession plans are worth reviewing now, while there is still time to plan rather than react.

Full paper (39/40) link below:
https://drive.google.com/file/d/19pcVL6p-fGdYKq8KIwYpJn9__cpr6KZf/view?usp=drive_link

Happy to discuss how this affects your structure.

12/07/2026

Doing the Right Things vs Doing Things Right: What the ATO’s Holiday Home Changes Mean for You

Most holiday home owners are genuinely trying to do the right thing. They rent the property out when they can, declare the income, and claim the expenses they believe they’re entitled to. The problem is rarely intent — it’s that tax law has quietly moved, resources are limited, and the right advice often only turns up after a review has already started. By then, getting it right from the start would have cost far less than fixing it after the fact.

That gap between doing the right things and doing things right is exactly where the ATO’s new holiday home guidance now sits. On 20 May 2026, the ATO finalised Taxation Ruling TR 2026/1, together with two Practical Compliance Guidelines, PCG 2026/2 (apportionment) and PCG 2026/3 (the “leisure facility” test). These replace the informal apportion-by-days approach many owners have relied on, with a much stricter framework built around an existing but rarely-used integrity rule: section 26-50 of the Income Tax Assessment Act 1997.

This is the kind of change that rewards owners who get ahead of it, and penalises those who find out about it after the fact. So what’s actually changed, and what to do about it.

The core change: the “leisure facility” test
Previously, most advisers treated a rented holiday home simply as a property to apportion — claim deductions for the days it was rented or genuinely available, and exclude the days used privately.

The ATO’s new guidance changes the starting question. Before any apportionment happens, you must first ask: is this property mainly used, or mainly held for use, to produce rental income — or is it mainly a private recreational asset that happens to earn some rent?

If a holiday home is not mainly used or held for use to produce assessable income — for example, where private use is prioritised, particularly during peak holiday periods, or where genuine attempts to rent it are limited, the ATO can classify it as a leisure facility under section 26-50.

Where that applies, deductions for costs tied to owning the property are denied in full. This includes mortgage interest, council rates, land tax, general maintenance, and depreciation on assets within the property. While rental income you receive still remains fully assessable — so a leisure facility can generate taxable income with almost no offsetting deductions. Only expenses incurred directly to earn the rental income itself (such as platform commissions, advertising, and guest-stay cleaning) can still be claimed.

If it isn’t a leisure facility: apportionment still applies
Where a property genuinely is mainly held to produce rental income, and personal use is only a minor, secondary feature, the leisure facility rule doesn’t apply. Instead, the more familiar apportionment approach continues under PCG 2026/2 — deductions are apportioned on a fair and reasonable basis, commonly using time (days rented vs days used privately) or floor area, or a combination of both. Expenses that relate solely to the rental activity, such as platform fees, don’t need to be apportioned at all.

Example: private use is minor
Consider an owner with an apartment near Gold Coast that’s listed and actively rented for most of the year, and used personally for four weeks over summer. Because the property is mainly held to produce rental income, it isn’t a leisure facility. The owner can claim their rates, interest, and other ownership costs, but must reduce those claims by roughly 28/365 to exclude the four weeks of private use — consistent with the ATO’s own worked examples of apportioning by the private-use period.

Example: use changes partway through the year
The ATO’s guidance also recognises that a property’s main use can genuinely change during the year. Where an owner initially uses a property mainly for their own holidays, then from a clear date onward lists it and makes it genuinely available to the public, the property can move from “leisure facility” to “mainly income-producing” from that date.

Deductions become available from the point of that clear change, though the owner may still need to apportion for any remaining private use after that date. Importantly, a one-off change in use, or the ordinary seasonal pattern (for example, a ski property being quiet after the snow season ends), does not by itself create this kind of change.

Example: high-risk vs low-risk arrangements
PCG 2026/3 sets out a risk framework rather than a strict day count. A low-risk arrangement generally involves limited personal use confined outside peak periods and consistently high occupancy the rest of the year. A high-risk arrangement involves the owner using the property heavily over peak periods (such as Christmas or Easter), making only token efforts to advertise it, or placing restrictions on bookings that discourage genuine tenants (high rates). No single factor is decisive — the ATO looks at the whole pattern of use and the genuineness of the rental effort.

Don’t forget the loan: redraw and mixed-purpose interest
A related but separate trap sits inside these changes: loan interest apportionment. Where an owner has redrawn on the property’s loan for private purposes — renovations to their main home, a car, a holiday, and so on — the interest attributable to that redrawn portion is not deductible, regardless of how the rest of the loan is used. The loan becomes a mixed-purpose loan, and interest must be apportioned between the deductible (income-producing) and non-deductible (private) components. This is assessed independently of whether the property itself is a leisure facility.

Key dates and transitional relief
• 12 November 2025 – the ATO first flagged this view (in draft form).
• 20 May 2026 – TR 2026/1, PCG 2026/2 and PCG 2026/3 were finalised.
• 1 July 2026 – the ATO’s transitional compliance approach ends. The ATO has indicated it will not devote compliance resources to reviewing expenses incurred before this date, but this concession does not protect arrangements involving avoidance, fraud, or evasion, or where someone takes inappropriate advantage of the transitional approach.
• From 1 July 2026 – a more active compliance approach applies going forward.

Doing things right, from the start
None of this means holiday home owners have been doing anything wrong. It means the definition of “right” has shifted, and the cost of finding that out late — through an ATO review rather than a conversation with your adviser — is far higher than the cost of a proactive check-in now.
1. Honestly assess whether the property is mainly income-producing or mainly a private asset, especially over peak periods.
2. Keep proper records: booking calendars, advertising history, pricing evidence, and any rental restrictions.
3. Review loan structure to identify and separately track any private redraws.
4. If renting to family or friends, keep evidence the rent reflects a genuine market rate, as no apportionment is required in that case.
5. Speak with your adviser to review existing arrangements and seek clarification.

This is where HV Tax comes in. You don’t need to become a tax expert to get this right — you need the right advice at the right time to put a defensible position in place. Doing things right from the start is always the lower-cost path.

04/07/2026

🚨"Failing to plan is planning to fail"
The game is about to change.

Australia's new Capital Gains Tax (CGT) reforms are coming into effect from 1 July 2027 and for many property investors, they could mean paying significantly more tax than under the current rules.
🏡Current rules
If you've owned an investment property for more than 12 months, you generally receive a 50% CGT discount.
💰From 1 July 2027
The 50% discount is replaced by:
✅ Cost base indexation (adjusting your purchase price for inflation)
✅ A 30% minimum tax rate on capital gains (where applicable)
The important point? Indexation only protects against inflation. It doesn't reduce tax on real capital growth.
--------------------------------------
📊 Simple illustration
Purchase price: $1,000,000
Sale price: $3,000,000
Capital gain: $2,000,000
>>> Sell before 1 July 2027
✔ Approximate tax: $470k (47% tax rate)
✔ After-tax gain: $1.53 million
>>>Sell after 1 July 2027 (illustrative example)
✔ Approximate tax: $808k(Index rate ~ 1.28)
✔ After-tax gain: $1.19 million (47% tax rate)
📌 That's around $338k more tax on the same gain.
-------------------------------------
⚠️ This example is simplified to explain how the new rules work.
Your actual outcome depends on:
• Purchase date
• Cost base
• Holding period
• Transitional rules
• Your marginal tax rate
Every investor's situation is different.
--------------------------------------
💡The biggest mistake?
Making a decision first and asking for tax advice afterwards.
By then, it's often too late.
A good accountant can help you plan.
No accountant can change history after the contract has been signed.

Now is the time to model your options—not after the sale.
Have you reviewed how these CGT changes could affect your investment strategy?

Assumptions:
• Original cost base: $1,000,000
• Sale price: $3,000,000
• Capital gain: $2,000,000
• Taxpayer on the 47% marginal tax rate
**Sell before 1 July 2027 (current rules)
• Capital gain: $2,000,000
• 50% CGT discount: $1,000,000 taxable
• Approximate tax: $470,000
• After-tax gain: $1,530,000
**Sell after 1 July 2027 (illustrative indexation factor of 1.28 after around 10 years)
• Indexed cost base: $1,280,000
• Taxable gain: $1,720,000
• Approximate tax: $808,400
• After-tax gain: $1,191,600
Illustrative difference: around $338,400 in additional tax on the same underlying economic gain.

This example is intentionally simplified to demonstrate the mechanics only. Actual calculations will depend on factors including acquisition date, holding period, transitional provisions, indexation factors, cost base adjustments, and your marginal tax rate. Every taxpayer's circumstances will be different.

So? Planning matters more than ever

This is not simply a tax return issue. It is a strategic decision that may affect when you sell, how you structure investments, and your long-term wealth.

As the saying goes: "Look before you leap."

Tax outcomes are determined by decisions made before a transaction occurs. Once a property is sold, history cannot be rewritten, and neither your accountant nor the ATO can reverse the tax consequences of that decision.

If you own investment assets, now is the time to model the potential impact of the new CGT rules and develop a strategy that aligns with your financial objectives.

Strategic tax planning today could save substantial tax tomorrow

24/06/2026

With the proposed $3 million superannuation balance tax and the removal of SMSF residential property borrowing, trustees may need to rethink how their retirement capital is invested.
The key question is no longer whether borrowing will be available, but where SMSF investment capital will move next.

21/06/2026

QLD Farmers: Putting money back to your pocket - Don't miss this!

If water cost is draining your farm budget, apply for the 15% Irrigation Pricing Rebate Scheme from QLD Government. You can reclaim 15% of your quarterly water bills supplying from Burnett Water, Seqwater or Sunwater for:

• 2025-2026 financial year
• 2026-2027 financial year

This rebate may help relief pressure on farm profitability.

Do you:
- Own and operate your farm?
- Have an ABN?
- Have primary production income declarations

If yes to all, you are likely qualified. Every dollar counts.

Submit your bills and payment proof via qrida.qld.gov.au before 31 Dec 2027.

Link below:
https://www.qrida.qld.gov.au/program/irrigation-pricing-rebate-scheme

15/06/2026

In just two weeks to the new financial year, major superannuation changes take effect — yet most business owners are still unaware. Don’t get caught off guard.

💰 Payday Super — Super Guarantee due within 7 business days of payday.
📞 Talk to HV Tax today to stay ahead if you do not have a strategy in place.

💡 Payday Super, new contribution caps, and Division 296 tax are about to reshape employer obligations and wealth strategies.

T: (07) 2141 6737
E: [email protected]
Booking: https://calendly.com/hvtax/discovery

04/06/2026

The proposed Negative Gearing and CGT reforms passed the Lower House today. If ultimately enacted, these reforms could represent the most significant restructuring of residential property taxation since the introduction of the 50% CGT discount in 1999. Strategic investors are already reviewing their portfolios, acquisition plans, and wealth-building strategies.