Published on 19 Mar 13
by SOUTH AUSTRALIAN DIVISION, THE TAX INSTITUTE
Your clients contact you asking how to negotiate with a large energy company wanting to install wind turbines on their land. Another client has received correspondence from a mining company seeking to obtain their permission to the granting of exploration rights. Yet another client has been approached by a property developer and is considering re-zoning and subdividing one of their surplus coastal farm land into beachside allotments.
This paper considers the increasing trend of primary production landowners to be involved in transactions with large corporations in the E&R and property development industries. It works through a number of case studies addressing the specific commercial and tax issues arising from transactions of this kind.
Specific topics covered include:
- taxation treatment of land access rights, easements, profit aprendres
- nature of gain or profit - revenue or capital and do any concessions apply?
- when does a farmer become a property developer for tax purposes - how to strategise for optimal outcomes
- does my client transfer the land to an optimal structure prior to thetransaction - what are the costs and benefits?