July 28, 2026 • 8 mins
Kylie Fisken talks about paying tax during a profitable farming year.
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Speaker 1 (00:09):
Well, welcome back to the muster.
Speaker 2 (00:11):
Kylie Fuskin of Malt McClain plus more based here, and
Gord joins us in studio over this afternoon. Dave Frame
earlier and Kylie there was a bit like a state
high one of guests into the studio.
Speaker 1 (00:21):
But it's never a bad thing.
Speaker 2 (00:22):
Good afternoon, Good afternoon, Andy, Kevin, busy, funny question.
Speaker 3 (00:27):
I am a little bit broken, but it's been so
much fun.
Speaker 1 (00:33):
I could just tell her they're look in your eyes.
I don't know if you've been cynical or not.
Speaker 3 (00:36):
Oh, absolutely, Look. Well you all knew it was coming
and we were hoping for it. But I've spent the
last couple of months buried in farm finances, and I
can tell you that the agricultural lead economic recovery is
showing up clearly in the numbers coming across my desk.
Speaker 1 (00:54):
Translation. People are paying tax.
Speaker 3 (00:56):
They are.
Speaker 4 (00:57):
Yeah.
Speaker 3 (00:58):
So last year I sat here at and I said,
we're completing our tax planning for our dairy farmers, and
we do it every year, and I hoped one day
we would need to do the same for our sheep
and beef farmers. And well, this is it.
Speaker 4 (01:11):
Here we are, this is the year.
Speaker 1 (01:13):
It's just put a bit more on your plate, but
it's a good thing.
Speaker 3 (01:15):
Yeah, absolutely, So the reason for all this work is
pretty simple. Land prices autumn cattle sales have taken many
farm bank accounts from negative balances to significant positive numbers
in a very short period of time. One of the
misconceptions that we come across is that if you've got
money in the bank, you've made a profit, or if
(01:37):
you've made a profit, there must be money in the bank. Unfortunately,
neither is these things is always true.
Speaker 4 (01:44):
They see it rich cash poor.
Speaker 3 (01:45):
Yeah, and that's why our tax planning is so important.
The point of tax planning isn't paying less tax. It's
understanding what proportion of the money sitting in your bank
account actually belongs to you and what portion belongs to
the inland revenue.
Speaker 1 (02:03):
Right, so where do we start with It's quite a
bit to entail.
Speaker 3 (02:05):
Yeah, So for farmers it's definitely worth having the conversation
now rather than waiting that until your financial statements are prepared.
Once we know how much money is set aside for tax,
we can work out what's genuinely cash saplus and that
is where we can start making good business decisions. Do
(02:26):
we invest in farm infrastructure, do we reduce debt? Do
we do something else?
Speaker 1 (02:33):
Something else?
Speaker 3 (02:34):
M holidays, hmmm, succession planning. That are conversations that we
haven't been able to have before or couldn't foresee being
able to have. You know, the boat, the holiday, the
holiday home. You were telling people to buy a boat. Yeah,
it was absolutely Are you still well? Look within reason,
(02:56):
you know, you've got to have some treats in life.
But just remember that if you're going to buy the bike,
it comes at a sacrifice of something else, depends what
the end goal is.
Speaker 4 (03:03):
Opportunity cost, opportunity cost.
Speaker 3 (03:07):
So you know, these decisions that we're making are much
easier when we know what's available to us. So if
you're going to buy a boat, make sure it's out
of available cash. So one of the things that I've
been doing is working out roughly people's taxable profit. So
how do we work out what is actually a taxable profit?
In simple terms, we take farm income, adjust for livestock
(03:29):
movements and stock values, deduct farm expenses, and that gives
us a profit. Apply your marginal tax rate, and you
have a tax liability. But there's often some misconceptions about
what's actually tax deductible and what isn't deductible, Or.
Speaker 1 (03:47):
We have the same conversation every December.
Speaker 2 (03:51):
Yeah, don't we about what you can claim for Christmas?
Speaker 3 (03:54):
So it's not just December, and it's not just Christmas.
It happens all year. So I thought, Andy, we could
have a quick game that you name something that we'd
spend money on, and I tell you whether it's a
deductible expense, it's non deductible, it's depreciable meaning you get
a tax deduction over time, or my personal favorite, it depends.
(04:19):
So we say depends more often than anyone would like,
and they don't have a straightforward answer because tax treatment
can depend what the cost relates to. And it's part
of a bigger picture project on farm.
Speaker 2 (04:33):
Right straight off the bat, a work trip to christ
Church to what go that shining new stadium, but you
go via.
Speaker 4 (04:39):
Fairly to look at a ball. I'd deduct that a
whole thing.
Speaker 3 (04:45):
There's probably the tickets to the game that you probably
wouldn't be deducting.
Speaker 1 (04:51):
If you were taking a work or with you or
something like that. Perhaps is there anywhere you can work
it in?
Speaker 2 (04:55):
Yeah, perhaps you want to look at the sources structure
of the new stadium.
Speaker 3 (05:00):
I was actually there on the weekend seeing the soil structure. No, no,
you're not going to be grazing livestock on there.
Speaker 1 (05:06):
You're not going to be grazing it. But you want
to see what hybrid grasses they've come up with.
Speaker 3 (05:10):
No, you're pushing the limits their end.
Speaker 1 (05:12):
Okay, so that's a possible. Well, this one's probably no brainer.
Speaker 2 (05:18):
But fencing as well, a lot of people were fencing
a lot of fencing this winter.
Speaker 1 (05:22):
We just think back to last October. People fled out
there having issues for farm insurance.
Speaker 4 (05:26):
Hmmm.
Speaker 3 (05:27):
Uh, I'm going to give you that. It depends on
what the bigger picture project on farm.
Speaker 1 (05:35):
So fencing is just solidifying your business for the future, surely.
Speaker 3 (05:38):
Oh absolutely. But if you've got a lend use change
going on and you're ripping out sheep fences and putting
in dairy fences, is that deductible?
Speaker 1 (05:45):
What about buying store animals?
Speaker 4 (05:47):
Cool?
Speaker 3 (05:47):
Buying store animals? Yep, a whole lot of money going
out of your bank at once, and yes you have
a text deduction for that. However, at balanced date, those
stock are still on your farm and they are then
valued and put on your balance sheet, so they're included
in your closing stock So cardata gates itself depending on
(06:07):
the livestock valuation method we're using, where the purchase can
be completely offset by the closing stock value.
Speaker 2 (06:14):
You just look at the sector at the moment and
we talk about these new things on farm tracks and everything.
Yes to appreciation after time, but it's something that's kind
of flown under the radar, but it's still there. Is
this twenty percent investment boost that the government implemented.
Speaker 4 (06:29):
How's that been received?
Speaker 3 (06:30):
Well, you see, yeah, no, it's definitely making a dint
in the calculations that we are that we're completing. So
if you border, you know, sixty thousand dollars yet during
the year, you're immediately getting twenty percent right off of
that of their asset in this financial year. Does it
work long term?
Speaker 1 (06:50):
No?
Speaker 3 (06:50):
Well, everything depreciates, yeah, but it's depreciating at an excelerated
rate in year one, So year two your depreciation is less.
Year three, you would appreciate is less. Year four, you
sell your ute and you pay back that depreciation that
you've claimed because ID rates have accelerated, the depreciation higher
than the actual capital.
Speaker 2 (07:11):
Value, And as soon as you drive something out of
out the door it depreciates some value as well.
Speaker 3 (07:15):
Yeah, I know, but if you look at a ute's
depreciation rate at a normal twenty percent of its written
down value every year, they haven't historically been writing down
unless you're really rough, haven't been writing down at a
twenty percent rate.
Speaker 2 (07:31):
So the big thing is before you go and buy
a ticket item go and do you go and do
your due diligence around text implications?
Speaker 4 (07:37):
Yeah, pick up the phone and how do.
Speaker 1 (07:39):
People pick up the phone and get in touch.
Speaker 3 (07:41):
They pick up the phone and call us here in
Gore on three two eight five oh double seven and
the Cargo on three two one four four one sixty
six or email us at Hello at MMCA dot codline
n Z.
Speaker 1 (07:58):
Always good to check Ylie.
Speaker 4 (07:59):
Thank you very much, X and D.
Speaker 2 (08:03):
M hmm Kylie Fusken of Melt McCain plus more based
here in Gore and the Cargo as well. You're listening
to the muster rupnickt from Derry and Zed Veronica OUs
fine d
Well, welcome back to the muster.
Speaker 2 (00:11):
Kylie Fuskin of Malt McClain plus more based here, and
Gord joins us in studio over this afternoon. Dave Frame
earlier and Kylie there was a bit like a state
high one of guests into the studio.
Speaker 1 (00:21):
But it's never a bad thing.
Speaker 2 (00:22):
Good afternoon, Good afternoon, Andy, Kevin, busy, funny question.
Speaker 3 (00:27):
I am a little bit broken, but it's been so
much fun.
Speaker 1 (00:33):
I could just tell her they're look in your eyes.
I don't know if you've been cynical or not.
Speaker 3 (00:36):
Oh, absolutely, Look. Well you all knew it was coming
and we were hoping for it. But I've spent the
last couple of months buried in farm finances, and I
can tell you that the agricultural lead economic recovery is
showing up clearly in the numbers coming across my desk.
Speaker 1 (00:54):
Translation. People are paying tax.
Speaker 3 (00:56):
They are.
Speaker 4 (00:57):
Yeah.
Speaker 3 (00:58):
So last year I sat here at and I said,
we're completing our tax planning for our dairy farmers, and
we do it every year, and I hoped one day
we would need to do the same for our sheep
and beef farmers. And well, this is it.
Speaker 4 (01:11):
Here we are, this is the year.
Speaker 1 (01:13):
It's just put a bit more on your plate, but
it's a good thing.
Speaker 3 (01:15):
Yeah, absolutely, So the reason for all this work is
pretty simple. Land prices autumn cattle sales have taken many
farm bank accounts from negative balances to significant positive numbers
in a very short period of time. One of the
misconceptions that we come across is that if you've got
money in the bank, you've made a profit, or if
(01:37):
you've made a profit, there must be money in the bank. Unfortunately,
neither is these things is always true.
Speaker 4 (01:44):
They see it rich cash poor.
Speaker 3 (01:45):
Yeah, and that's why our tax planning is so important.
The point of tax planning isn't paying less tax. It's
understanding what proportion of the money sitting in your bank
account actually belongs to you and what portion belongs to
the inland revenue.
Speaker 1 (02:03):
Right, so where do we start with It's quite a
bit to entail.
Speaker 3 (02:05):
Yeah, So for farmers it's definitely worth having the conversation
now rather than waiting that until your financial statements are prepared.
Once we know how much money is set aside for tax,
we can work out what's genuinely cash saplus and that
is where we can start making good business decisions. Do
(02:26):
we invest in farm infrastructure, do we reduce debt? Do
we do something else?
Speaker 1 (02:33):
Something else?
Speaker 3 (02:34):
M holidays, hmmm, succession planning. That are conversations that we
haven't been able to have before or couldn't foresee being
able to have. You know, the boat, the holiday, the
holiday home. You were telling people to buy a boat. Yeah,
it was absolutely Are you still well? Look within reason,
(02:56):
you know, you've got to have some treats in life.
But just remember that if you're going to buy the bike,
it comes at a sacrifice of something else, depends what
the end goal is.
Speaker 4 (03:03):
Opportunity cost, opportunity cost.
Speaker 3 (03:07):
So you know, these decisions that we're making are much
easier when we know what's available to us. So if
you're going to buy a boat, make sure it's out
of available cash. So one of the things that I've
been doing is working out roughly people's taxable profit. So
how do we work out what is actually a taxable profit?
In simple terms, we take farm income, adjust for livestock
(03:29):
movements and stock values, deduct farm expenses, and that gives
us a profit. Apply your marginal tax rate, and you
have a tax liability. But there's often some misconceptions about
what's actually tax deductible and what isn't deductible, Or.
Speaker 1 (03:47):
We have the same conversation every December.
Speaker 2 (03:51):
Yeah, don't we about what you can claim for Christmas?
Speaker 3 (03:54):
So it's not just December, and it's not just Christmas.
It happens all year. So I thought, Andy, we could
have a quick game that you name something that we'd
spend money on, and I tell you whether it's a
deductible expense, it's non deductible, it's depreciable meaning you get
a tax deduction over time, or my personal favorite, it depends.
(04:19):
So we say depends more often than anyone would like,
and they don't have a straightforward answer because tax treatment
can depend what the cost relates to. And it's part
of a bigger picture project on farm.
Speaker 2 (04:33):
Right straight off the bat, a work trip to christ
Church to what go that shining new stadium, but you
go via.
Speaker 4 (04:39):
Fairly to look at a ball. I'd deduct that a
whole thing.
Speaker 3 (04:45):
There's probably the tickets to the game that you probably
wouldn't be deducting.
Speaker 1 (04:51):
If you were taking a work or with you or
something like that. Perhaps is there anywhere you can work
it in?
Speaker 2 (04:55):
Yeah, perhaps you want to look at the sources structure
of the new stadium.
Speaker 3 (05:00):
I was actually there on the weekend seeing the soil structure. No, no,
you're not going to be grazing livestock on there.
Speaker 1 (05:06):
You're not going to be grazing it. But you want
to see what hybrid grasses they've come up with.
Speaker 3 (05:10):
No, you're pushing the limits their end.
Speaker 1 (05:12):
Okay, so that's a possible. Well, this one's probably no brainer.
Speaker 2 (05:18):
But fencing as well, a lot of people were fencing
a lot of fencing this winter.
Speaker 1 (05:22):
We just think back to last October. People fled out
there having issues for farm insurance.
Speaker 4 (05:26):
Hmmm.
Speaker 3 (05:27):
Uh, I'm going to give you that. It depends on
what the bigger picture project on farm.
Speaker 1 (05:35):
So fencing is just solidifying your business for the future, surely.
Speaker 3 (05:38):
Oh absolutely. But if you've got a lend use change
going on and you're ripping out sheep fences and putting
in dairy fences, is that deductible?
Speaker 1 (05:45):
What about buying store animals?
Speaker 4 (05:47):
Cool?
Speaker 3 (05:47):
Buying store animals? Yep, a whole lot of money going
out of your bank at once, and yes you have
a text deduction for that. However, at balanced date, those
stock are still on your farm and they are then
valued and put on your balance sheet, so they're included
in your closing stock So cardata gates itself depending on
(06:07):
the livestock valuation method we're using, where the purchase can
be completely offset by the closing stock value.
Speaker 2 (06:14):
You just look at the sector at the moment and
we talk about these new things on farm tracks and everything.
Yes to appreciation after time, but it's something that's kind
of flown under the radar, but it's still there. Is
this twenty percent investment boost that the government implemented.
Speaker 4 (06:29):
How's that been received?
Speaker 3 (06:30):
Well, you see, yeah, no, it's definitely making a dint
in the calculations that we are that we're completing. So
if you border, you know, sixty thousand dollars yet during
the year, you're immediately getting twenty percent right off of
that of their asset in this financial year. Does it
work long term?
Speaker 1 (06:50):
No?
Speaker 3 (06:50):
Well, everything depreciates, yeah, but it's depreciating at an excelerated
rate in year one, So year two your depreciation is less.
Year three, you would appreciate is less. Year four, you
sell your ute and you pay back that depreciation that
you've claimed because ID rates have accelerated, the depreciation higher
than the actual capital.
Speaker 2 (07:11):
Value, And as soon as you drive something out of
out the door it depreciates some value as well.
Speaker 3 (07:15):
Yeah, I know, but if you look at a ute's
depreciation rate at a normal twenty percent of its written
down value every year, they haven't historically been writing down
unless you're really rough, haven't been writing down at a
twenty percent rate.
Speaker 2 (07:31):
So the big thing is before you go and buy
a ticket item go and do you go and do
your due diligence around text implications?
Speaker 4 (07:37):
Yeah, pick up the phone and how do.
Speaker 1 (07:39):
People pick up the phone and get in touch.
Speaker 3 (07:41):
They pick up the phone and call us here in
Gore on three two eight five oh double seven and
the Cargo on three two one four four one sixty
six or email us at Hello at MMCA dot codline
n Z.
Speaker 1 (07:58):
Always good to check Ylie.
Speaker 4 (07:59):
Thank you very much, X and D.
Speaker 2 (08:03):
M hmm Kylie Fusken of Melt McCain plus more based
here in Gore and the Cargo as well. You're listening
to the muster rupnickt from Derry and Zed Veronica OUs
fine d
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