Starting a small farm

2 posts
Tue, 09/06/2016 - 23:27 #1

Member for

8 years 5 months
Tallanalla
Last seen: 03/26/2018 - 15:46
Joined: 07/06/2016 - 08:40

Starting a small farm

Hi, My partner and I have purchased a 160 acre property and are wanting to start making a small income off it. We both have full time jobs but are goign to buy a small flock of sheep soon to breed and sell for meat. What do we need to do to set ourselves up...are we a business? Are we a partnership, company, sole trader? Do we need an ABN? Do we need an ABN before we can get a PIC number? Are we only a hobby farm until we are turning over $20,000 a year? If so how do we register as a hobby farm and what are our monetary reporting requirements? We have already spoken to the ATO but they unfortunately couldn't answer our questions. I know there are a lot of question there but if anyone has some advise we would greatly appreciate it. Thank you very much Amy and Joel
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Wed, 09/07/2016 - 17:48 #2
charlie
Last seen: 12/26/2018 - 09:21
Joined: 05/31/2011 - 09:44
Hi Amy and Joel,
Welcome to Farmstyle and the forum. No surprise that the ATO was no help.
The following is general advice, it may be worthwhile for you discuss your questions with an accountant. I will try and answer each question one at a time:
* What do we need to do to set ourselves up...are we a business? You are in business if you are turning over more than $20k per year and your aim is to make a profit.
* Are we a partnership, company, sole trader? You can decide your business structure, what structure you decide will depend on your off farm income, tax position, concerns around liability and level of recording/reporting.
* Do we need an ABN? It is not compularsy to have an ABN until your turnover is above $20k, that said having ABN tends to makes it easier to do bussiness with other companies.
* Do we need an ABN before we can get a PIC number? No, your PIC or property identification code is unique to the farm and has nothing to do with the ABN.
* Are we only a hobby farm until we are turning over $20,000 a year? If so how do we register as a hobby farm and what are our monetary reporting requirements? If you are turning over less than $20k per year it will be classed as a hobby, in this case you can use the Statement by a supplier form (made in the course or furtherance of an activity done as a private recreational pursuit or hobby) to justify the payer not withholding from the payment.
Regards,
Charlie
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