agribusiness
provider. Although it is unlikely that you'll ever need to claim on
this, you could quickly see your investment wiped out in the event of a
natural disaster as you would be removed from the overall pooling.
Investments are less liquid than typical equity based managed funds
- It is important to understand that unlike managed funds, you are not
able to sell your investment tomorrow if you decided you needed to
access your money and retain the initial tax benefits. Although new
rules were passed in 2007 allowing investors to trade their investments
(after 4 years), the active market into which you can sell these
investments is still relatively small.
Product Rulings are a must -
The ATO regulate the tax deductibility of agribusiness schemes in Australia. Schemes with a product ruling add an additional layer of security in that the investment provider has received prior agreement from the ATO that their scheme qualifies as a tax deductable scheme, on the basis that the manager proceeds with managing the project as outlined in the Product Ruling. So if you are thinking about investing in this type of investment check the 'product ruling' on the ATO website (www.ato.gov.au).
Use a discount broker -
With many agribusiness providers paying around 8% in commission to planners, a rebate goes a long way.
So what type of Agribusiness product should I look to invest in?
There is a broad range of agribusiness schemes available to you, each
have there own distinctive attractions. However, forestry is the most
established and the only sector which has received the grace of the
Federal Government in relation to tax deductions going forward. As a
result, we have chosen to focus on these projects.
