Act reference: Farm Household Support Act 2014 section 8(b) Farm Enterprise – Assessment of significant commercial purpose or character The farm enterprise to which a person or their partner contributes a significant part of his or her labour and capital must have a significant commercial purpose or character. This requirement prevents ‘hobby farmers’ from qualifying for payment. The intention of FHA is to support farmers and their partners who do not have an alternative source of income on which to draw for self-support. When determining if a farm enterprise has a significant commercial purpose or character the following matters must be taken into account: whether a business plan has been drawn up for the farm enterprise; if the person or the person’s partner (where the person is not a farmer) is not an expert in respect of the farm enterprise: whether relevant expert advice has been sought about the farm enterprise from a relevant authority, an experienced farmer or an agent; or whether relevant technical literature on the farm enterprise has been obtained; whether it has been established that the land that is used for the purposes of the farm enterprise is suitable for the farm enterprise, including by analysing soil and water samples; whether the person or the person’s partner (where the person is not a farmer) has: considered if there is a commercial market, or a potential commercial market, for the farm enterprise; and investigated the capital requirements of the farm enterprise, including by planning how capital for the farm enterprise will be obtained and used; and conducted research into the farm enterprise confirming (based on market prospects, the expected level of production, and the running costs, of the farm enterprise) that profits can be expected; and ensured the size and scale of the farm enterprise is sufficient for a commercial enterprise; whether legal requirements required to operate the farm enterprise on a commercial basis have been, or could at the appropriate time be, complied with; whether there is: an intention to make a profit in respect of the farm enterprise; and a reasonable belief that the farm enterprise is likely to generate a profit. Act reference: Farm Household Support Act 2014 section 8(c); Farm Household Support Secretary’s Rule 2014 section 5
Act reference: Farm Household Support Act 2014 section 8(b) Farm Enterprise – Assessment of significant commercial purpose or character The farm enterprise to which a person or their partner contributes a significant part of his or her labour and capital must have a significant commercial purpose or character. This requirement prevents ‘hobby farmers’ from qualifying for payment. The intention of FHA is to support farmers and their partners who do not have an alternative source of income on which to draw for self-support. When determining if a farm enterprise has a significant commercial purpose or character the following matters must be taken into account: whether a business plan has been drawn up for the farm enterprise; if the person or the person’s partner (where the person is not a farmer) is not an expert in respect of the farm enterprise: whether relevant expert advice has been sought about the farm enterprise from a relevant authority, an experienced farmer or an agent; or whether relevant technical literature on the farm enterprise has been obtained; whether it has been established that the land that is used for the purposes of the farm enterprise is suitable for the farm enterprise, including by analysing soil and water samples; whether the person or the person’s partner (where the person is not a farmer) has: considered if there is a commercial market, or a potential commercial market, for the farm enterprise; and investigated the capital requirements of the farm enterprise, including by planning how capital for the farm enterprise will be obtained and used; and conducted research into the farm enterprise confirming (based on market prospects, the expected level of production, and the running costs, of the farm enterprise) that profits can be expected; and ensured the size and scale of the farm enterprise is sufficient for a commercial enterprise; whether legal requirements required to operate the farm enterprise on a commercial basis have been, or could at the appropriate time be, complied with; whether there is: an intention to make a profit in respect of the farm enterprise; and a reasonable belief that the farm enterprise is likely to generate a profit. Act reference: Farm Household Support Act 2014 section 8(c); Farm Household Support Secretary’s Rule 2014 section 5
fha-guidelines.docx