25 Oct 1212 Is windfarm income "assessable primary production income" - TD 2012/D9
On 24 October 2012, the ATO released for public comment by 23 November 2012 draft Taxation Determination TD 2012/D9 entitled "Income tax: does ordinary income derived by an individual from allowing wind farming infrastructure to be constructed, operated and accessed on freehold land that they own and use in carrying on a primary production business constitute 'assessable primary production income' of that individual for the purposes of Division 392 of ITAA 1997?"
The answer given is No.
Paragraphs 14 and 15 of the draft Determination state, in part, as follows:
"Given the differences in the extent and nature of the primary production business activities of the individuals who derive the ordinary income, it can be seen that the source of the income dealt with in this draft Determination is not their particular primary production activities. Rather, the income is sourced in the individual's ownership of the land on which the wind farming infrastructure is constructed, operated and accessed...There is no causative connection between the income derived and the particular primary production business being carried on."