Drought relief may include tax

With Taranaki farming communities facing their toughest challenge in decades, due to the extended Lower North Island drought, it’s important to review what support options are available.

The Government’s decision to classify the drought as a mediumscale adverse event across several parts of the country, including New Plymouth and South Taranaki, is aimed at allowing government agencies to step up with additional support for farmers and growers in affected areas.

Revenue Minister Stuart Nash has outlined that this will ensure the Inland Revenue Department (IRD) provides greater flexibility and assistance for those affected. He has encouraged any farmers who find themselves struggling to meet their tax obligations because of the adverse conditions to talk to their accountant and engage with IRD.

Farmers in drought-affected areas should expect a more accommodating response from IRD in the event that they are not in a position to pay taxes, such as PAYE, GST and income tax, on time.

In addition IRD will allow farmers in drought areas to make late income equalisation deposits for the 2016-2017 income tax year. Farmers will also be able to apply immediately for an early refund of these deposits – rather than waiting the usual 12 months for them to be returned. This concession can be of real value with 2017 being a good income year for dairy farmers and 2018 being quite disastrous for the farmers worst affected by the drought.

It is also important to be aware of other generally available sources of support, such as Rural Assistance Payments (RAPs) which drought-affected farmers may be able to access.

RAPs are provided through Work and Income to help meet essential living expenses, with payments equal to Jobseeker Support for farmers affected by an adverse event.

You do not have to be on a benefit to qualify for RAPs. You may be eligible if your farm is in the New Plymouth or South Taranaki district council areas and is your main source of income – including meat, wool, dairy products, sharemilking, arable farming, market gardening, herb or flower growing.

The criteria is that the applicant is finding it difficult to meet essential living expense through their farming business and has no other significant income and assets connected to that business.

Application forms are available online and your local Rural Support Trust will be able to help with filling it out if needed. An Agriculture Recovery Facilitator is required to sign the declaration part of the form – this will generally be your local Rural Support Trust co-ordinator.

To get in touch with your local Rural Support Trust visit ruralsupport.org.nz. You can also call the Rural Support Trust at any time for a confidential chat about any issues – be it you, your business, the weather, your finances or a neighbour, partner, friend, family member or worker you may be concerned about. Call 0800 RURAL HELP.