The ATO understands a number of businesses are impacted by the recent bushfires, and have recently received some questions regarding the Wine Equalisation Tax (WET) producer rebate from impacted businesses.
Due to the bushfires affecting the wine and cider industry, producers of wine and cider may need to seek alternative suppliers of their source products. If your business is impacted, please remember you need to own the source product to be eligible to claim the WET producer rebate.
WET producer rebate eligibility criteria
To be able to claim the WET producer rebate, a business must:
There is no entitlement to the producer rebate where a business did not own the source product that makes up at least 85% of the total volume of the wine throughout the winemaking process.
The source product can either originate from vineyards and orchards owned by the business, or be purchased prior to the commencement of the winemaking process.
The business is required to maintain continuous ownership of at least 85% of the source product from immediately prior to crushing (or immediately prior to the initial fermentation for mead and sake) until the wine is placed in a container that meets the packaging and branding requirements.
Where source product is supplied under a supply agreement, ownership of the source product will pass when the parties to the agreement intend and agree for ownership to pass.
What is NOT source product
Purchased bulk wine or juice would not be regarded as source product, or deemed source product (additives and ingredients that are used in small quantities in traditional winemaking processes), and could only form part of the remaining 15% of the volume of the wine.
You can read more about the WET Producer rebate
If you have been impacted by the bushfires, the ATO understands your priority is on your family and community. They have implemented a range of measures to help you during this time. If you live or work in one of the identified impacted post codes the ATO will automatically defer any lodgements or payments you have due until 28 May 2020.
Payment and lodgement deferrals for people in bushfire impacted postcodes don’t apply to large withholders (that is, those who have previously withheld more than $1 million tax annually or are part of a corporate group that has).
The ATO will also provide assistance in other ways, including fast tracking any refunds owed, remitting penalties or interest charged during the times you have been impacted by the fires, and helping businesses re-construct tax records lost or damaged.
More information on ATO assistance is available or you can call on 1800 806 218.
The Australian Government also has a comprehensive suite of measures to help small businesses, who have suffered direct fire damage, or have been indirectly economically impacted following the bushfires, get back on their feet, including: