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Transfer Requirements Where Property Owned by Company or Trust

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Transfer must have been between natural persons

VEA?

Only transfers of property between natural persons were considered for the purpose of accepting participation in RAFS.

Transfer requirements where farm owned by a private company

VEA?

Where a private company owned the farm or farms, the farm(s) and relevant farm assets it was necessary to firstly transfer the farm assets from the company to the farmer. The farmer could then transfer the land to the younger generation as a transfer between natural persons in order to take advantage of RAFS.

Transfer of shares in company not permitted

Where a company owned the farm(s), there must have been a transfer of legal title of the land before participation in RAFS was permitted. Transfer of the private company shares by the farmer to an eligible descendant was not permitted. To participate in the scheme the transfer of the property must have been between natural persons.

Farm owned by a trust

Where the farm(s) was owned by a trust, it was possible for the farmer to qualify under RAFS by transferring their trusteeship of a private trust to the descendant(s). Under trust law, a trust is the legal owner of land held within a trust. Alternatively, the trustee may have chosen to transfer the farming assets to the farmer, who then transferred the farm assets to the eligible descendant(s).

A farmer who was trustee of a trust that owned the farm and farm assets had a qualifying interest in the farm(s). A retiring farmer who was a beneficiary only and not a trustee did not satisfy the rules relating to qualifying farmer.    

More ?

Assessment of trusts

Chapter 10.3

More ? (go back)


According to subsection 5P(1) of the VEA, a farm means any land that is used:

  • For the purposes of a farm enterprise; or
  • In connection with a farm enterprise.

 

 

According to subsection 5P(1) of the VEA, a farm means any land that is used:

  • For the purposes of a farm enterprise; or
  • In connection with a farm enterprise.

 

 

According to subsection 5P(1) of the VEA, a relevant farm asset in relation to a farm, means any livestock, crop, plant or equipment that is a produce of, or is used for the purposes of, the farm enterprise.

 

 

A farmer holds a qualifying interest in a farm if they:

  • have legal ownership of the farm land;
  • hold a pastoral lease over the farm land;
  • hold an equitable interest in general law land which is mortgaged; or
  • are a sharefarmer in a private company that owns or holds a pastoral lease over the farm land.

Refer to section 5P(5) of the VEA for the full definition.

 

 

A person is considered to be a qualifying farmer if they have:

  • held a qualifying interest in the farm for a continuous period of 15 years; or
  • acquired a qualifying interest in the farm before 15 September 1997 and been actively involved in farming in Australia for any period of 20 years.

During either period the person or their partner must have derived a significant part of their income and contributed a significant part of their labour to the development of a farm.

Refer to subsection 5P(3) and subsection 5P(4) of the VEA for the full definition.