ECRP Income and Asset Test Questions

Are farm or small business assets exempt from the asset test?

Assets, including the farm, that are essential to the running of the farm or small business are not included in the assets test.

Can a small business operator have farm assets excluded too?

In some cases, individuals who apply for ECRP as a small business operator may have their farm assets exempted. In order for small business operators to have farm assets exempted, they must be able to demonstrate that as well as meeting the eligibility requirements for ECRP as a small business operator, they also meet the eligibility requirements for ECRP as a farmer, with the exception of deriving significant income from the farm.

Are gifted assets exempt from the asset test?

When assessing the assets of applicants and recipients of ECRP, assets that are exempt under the Farm Household Support Act 1992, are excluded from the application of gifting provisions that would apply under the Social Security Act 1991.

This means farmers may continue to receive ECRP after they gift farm land and assets, provided they continue to farm and meet the ECRP eligibility criteria.

This does not apply to gifted farm land for which the farmer did not have a right or interest in for the purpose of a farm enterprise. All assets which do not meet the conditions of an exempt asset under section 3(2) of the Farm Household Support Act 1992, are subject to gifting rules as per the Social Security Act 1991.

Is superannuation exempt from the asset test?

Farmers and small business operators superannuation scheme assets are exempt from the asset test for ECRP. This exemption continues even if the farmer or small business operator has reached the Age Pension age or is drawing income from the scheme.

However, for eligible farmers and small business operator’s partners, their superannuation scheme ceases to be an exempt asset once they have reached Age Pension age, or begins to draw income from their superannuation scheme.

Is income from a superannuation scheme exempt from the income test?

No, income drawn from a superannuation scheme is not exempt from the income test for ECRP.

Is ECRP primary production income?

No, ECRP cannot be counted as income from primary production for taxation purposes.

What are off-farm salary and wages?

Off-farm salary and wages is income paid to a person from an employer for work or services performed, that is not in anyway related to the farm enterprise.

Where can I get further information?

For more information on Exceptional Circumstances support and other Australian Government drought assistance measures call the Drought Assistance Hotline on 13 23 16 or visit www.daff.gov.au/droughtassist