As New Zealand’s rural economy evolves, farm accounting is no longer just about tax returns. In 2025, rural accounting now plays an essential role in sustainability, succession, and strategic decision-making. Here are some key considerations for farmers and rural businesses.
Environmental Compliance & Emissions Reporting
New environmental regulations mean farms must now account for their environmental impact.
Considerations:
- Tracking costs of mitigation strategies (e.g., planting, effluent upgrades);
- Managing potential levies or carbon credits;
- Understanding how environmental spending is considered within your financial statements.
Choose an accountant with agri-environmental expertise to keep on-track with evolving compliance rules.
GST & Mixed-Use Operations
Whilst diversification is good, GST rules can be complex.
Considerations:
- Accurate GST treatment across farming and non-farming income;
- Correct input tax claims on shared expenses;
- Filing frequency to suit cash flow cycles.
Keep income and expenses well categorised and clarify GST positions with your accountant regularly.
Tech-Driven Accounting & Real-Time Data
Cloud software is now the standard, not a luxury.
Considerations:
- Adopting tools like Xero, Figured, MYOB, or Farm Focus;
- Real-time reporting for better cash flow planning;
- Integration with farm management systems.
For a complete financial picture, utilise technology that syncs with your bank and livestock agents.
Succession Planning & Intergenerational Wealth
With a generation of farmers nearing retirement, transition planning is crucial.
Considerations:
- Having up-to-date business structures (trusts, partnerships, companies);
- Valuation of assets and land;
- Managing tax implications of gifting vs selling.
Start discussions as early as possible. Bring in your accountant, lawyer, and family for cohesive planning.
Cash Flow Management & Benchmarking
Volatile markets require robust forecasting.
Considerations:
- Budgeting for inflation, weather events, and payout fluctuations;
- Comparing performance to regional averages;
- Managing loan covenants and tax payments.
Don’t wait for the year-end. Update your forecasts quarterly, particularly following any major event.
Smart Tax Planning in 2025
Tax laws are shifting; use these to your advantage.
Considerations:
- Accelerated depreciation on environmental improvements;
- Thresholds for immediate asset deductions;
- Income spreading options to manage variability.
Tax planning should happen before the year-end. Book a mid-year tax strategy session with your accountant.
Final Thoughts
Farm accounting in 2025 is about partnership and planning. Your accountant can be more than just a number cruncher; they can be a valued strategic advisor who understands and prioritises your land, your goals, and your legacy.
Need help navigating your farm finances?
Call us: (06) 374 7059 | Email: vasb@zpvn.pb.am