1.1.P.390 Primary production (assets, liabilities)

Usage

These definitions are to be used when assessing the assets of a primary producer (section 11(1)-'primary producer').

Act reference: SSAct section 11(1)-'primary production'

Definition: primary production asset

A 'primary production asset' is any asset that is used to carry on the primary production business. It includes:

• land, AND
  • Exception: Under the private land use test (4.6.8.40), the principal home (section 11A(1)) and adjacent land of up to 2 hectacres is excluded. Under the extended land use test (4.6.8.50), age pensioners and CP recipients of age pension age may exempt the land in excess of 2 hectacres adjacent to their principal home that is under the same title document, provided they are making effective use of the land.
• machinery, AND
• plant or equipment, AND
• stock.

Act reference: SSAct section 11A(1) Principal home

Definition: primary production liability

A 'primary production liability' is a liability gained specifically for funding or sustaining the primary production business.

Act reference: SSAct section 11(1)-'primary production'

Policy reference: SS Guide 4.6 Assets, 4.7.4 Assessing the Income & Assets from Primary Production

_______________________________________________________

Last reviewed: 3 May 2010