Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Deductions - Farming and aquacultural business expenditure

DO 2: Plantings for erosion, shelter, and water protection purposes

You could also call this:

“Tax deductions for protective plantings on farmland”

If you run a farming or agricultural business on land in New Zealand, you can get money back for planting or maintaining trees and plants. This applies even if farming isn’t your main business on that land.

You can claim money back for planting or maintaining trees and plants that do any of these things:

  1. Stop your land from washing away
  2. Provide shelter for your land
  3. Stop farming or agricultural pollution from harming waterways

This rule lets you claim money back even if the plants are not on your land. It also overrides the usual rule about not claiming for long-term investments. However, you still need to follow the general rules about what you can claim for.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1513917.

Topics:
Money and consumer rights > Taxes
Environment and resources > Farming and fishing
Business > Industry rules
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DO 1: Enhancements to land, or

“Expenses for improving farmland that you can claim as deductions”

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DO 3: Trees on farms, or

“Farmers can claim money for planting and maintaining certain trees on their land”

Part D Deductions
Farming and aquacultural business expenditure

DO 2Plantings for erosion, shelter, and water protection purposes

  1. This section applies when a person carries on a farming or agricultural business on land in New Zealand, whether or not the business is the principal business carried on on the land.

  2. The person is allowed a deduction for expenditure that they incur in planting or maintaining trees or plants, whether or not on the land, for the purpose of—

  3. preventing or combating erosion of the land:
    1. providing shelter to the land:
      1. preventing or mitigating detrimental effects on a watercourse or body of water from the discharge of farming or agricultural contaminants.

        1. This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply.

        Compare
        Notes
        • Section DO 2 heading: replaced (with effect on 1 April 2011), on , by section 32(1) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
        • Section DO 2(2): replaced (with effect on 1 April 2011 and applying to a person for expenditure incurred: (a) in the 2011–12 or a later income year; (b) in an income year corresponding to a tax year beginning on or after 1 April 2008 and before 1 April 2011 if the person includes the expenditure as a deduction in a tax return made on or before the due date for a tax return for the income year), on , by section 32(2) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).