Can ACCUs be part of succession planning?

Farmers are free to negotiate terms with any service provider as to their preferred treatment of ACCUs. What if I want to keep them?

Often the benefits of ACCUs are shared between a service provider and the farmer. Sometimes in income sharing.

But farmers are coming to understand that there may be other structures /uses of ACCUs that are attractive to them. And why not negotiate?

It’s not well known, but I have always thought that ACCUs could be part of a farming family’s succession planning. It’s not always easy to navigate who will get what when some members don’t want to stay on farm but need to be given shared value.

How can that happen?

If an ACCU is delivered to your ANREU account (Australian National Register of Emission Units) it does not have to be sold (retired) immediately.

If your arrangement with the provider is that you can hold your ACCUs (while the provider may want to sell their portion), they end up on your Balance Sheet as an asset, to be taxed when income is realised.

I wrote this piece in 2019 if you can believe it, but it’s just coming into focus now:

There is heaps of detail in the link within the article. Now may be the time to take some notice of this.

NOTE: The tax treatment of ACCUs as Primary Producer income is changing. We’ll explain at the conference.

Interestingly, I spoke of “when the price of carbon is $30” in the article in 2019, Well, it’s $35 now!

How does this affect succession planning?

Here’s a hypothetical:

Child A wants to stay on the farm and keep stewarding the land. Child B does not, but needs to be treated fairly in the succession outcomes. The property has initiated a carbon farming project. Let’s call it 50 ha of tree planting.

This project has two pathways to assist succession:

  1. Child B takes ‘ownership’ of the plantings, looks after them and is rewarded with the ACCUs. Does not have to come back to the farm full time to do it, but keeps hand in the family heritage.
  2. Tree plantings are managed as part of the whole farm. ACCUs are delivered into Child B’s ANREU account and they have the choice of what to do with them. There is a forward estimate of abatement and some back of the envelope calculations as to what they will be worth.

No selling of any land is required! It’s worth thinking about, right?

Our accountant will clarify many issues around the accounting side of ACCUs. Others will be happy to answer questions as well.

But the ONLY place to get this information, plus so much more, is at the Nature-Based Solutions Conference & Expo. See you there!

With less than 3 weeks to go, register now!





Three or more delegates from any one farm or organisation can attend at Earlybird rates. Get plain-English, farmer-focused carbon market knowledge delivered by experts at the inaugural

Nature-Based Solutions Conference & Expo

Monday 17–Wednesday 19 July 2023