Researching fodder storage write-offs? Is fodder storage part of your drought management plan? Looking to advantage of government grants on your hay shed project?
The importance of fodder storage for primary producers and livestock enterprises can’t be overstated.
For example, on-farm storage such as hay sheds, grain sheds and silos can:
- Save you money by allowing you to buy feed in when prices are lower
- Help you prepare ahead for dry times and drought
- Provide peace of mind and help you make confident decisions during drought
The value of fodder storage, particularly as a part of a drought management and resilience strategy, is recognised by government at both state and federal levels.
This is reflected in the 100% fodder storage asset write-off which was introduced in 2018 and the grants currently available in select states.
Plus, there is also a RIC Drought Loan available to eligible farmers across Australia.
We realise it can be difficult to keep track of all the incentives and funding available, and whether you are eligible.
So, in this article, we provide an overview of eight of the most common write-offs, grants and loans available for fodder storage assets in 2025. This includes several incentives that are only available at a state level.
In this article:
- 100% Tax Write-Off For Fodder Storage Assets
- Regional Investment Corporation Drought Loan
- QRIDA Drought Preparedness Grant
- QRIDA Sustainability Loan
- QRIDA Drought Ready & Recovery Finance Loan
- RAA Drought Ready & Resilience Fund
- SA’s On-Farm Drought Infrastructure Scheme
- VIC’s On-Farm Drought Infrastructure Grant For Select LGAs
Please note that the information in this article is general only and does not constitute business or financial advice. Speak with your accountant and/or relevant state authority to determine your eligibility.
First up is the 100% tax write-off for fodder storage assets which is always a popular topic at this time of the year.
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100% Tax Write-Off For Fodder Storage Assets
This incentive works by allowing eligible primary producers to deduct the full cost of eligible assets from their taxable income.
By reducing their taxable income the primary producer can reduce their tax payable.
For example:
Kevin builds a hay shed to store hay to feed his sheep. The hay shed costs $80,000.
Kevin’s taxable income is $250,000. Using his hay shed as a tax deduction, Kevin can reduce his taxable income by $80,000, reducing it to $170,000.
As a result, Kevin pays tax on an income of $170,000 rather than $250,000.
Eligible Assets
“A fodder storage asset includes a structural improvement, a repair of a capital nature, or an alteration, addition or extension, to an asset or structural improvement, that is a fodder storage asset.”
Examples of eligible fodder storage assets include:
- Hay Sheds
- Grain Sheds
- Grain Bunkers
- Grain Bins
- Silos
What Does “Primarily and Principally” Mean?
Primarily and principally means that the main purpose of the asset must be to store fodder for livestock.
An example provided by the ATO is “if you built a shed for the purpose of storing hay but occasionally use it to store a neighbour’s tractor, it would still meet the ‘primarily and principally’ test because its main purpose is to store fodder.”
The ATO provides more examples and information on how this applies to dual-purpose assets here.
Are There Any Deduction Limits?
The deduction you can claim is limited to the capital expenses that you incur for construction, manufacture, installation and acquisition.
Different rules will apply to partnership expenses, recouped expenses and second-hand assets.
Visit the ATO website to learn about the eligibility requirements in detail.
What Other Fodder Storage Write-Offs Are Available?
If you are unable to meet the requirements for the fodder storage asset write-off, there are some alternative ways to use an asset such as a hay shed to reduce your tax payable.
These could include:
These will each have their own eligibility requirements that need to be met.
Alternatively, the $20,000 instant asset write-off is also still available for this financial year. This can be applied to a wider range of assets that cost $20,000 or less. You can learn about this here.
It is intended that “Small businesses, with aggregated turnover of less than $10 million, will be able to immediately deduct the full cost of eligible assets costing less than $20,000 that are first used or installed ready for use between 1 July 2024 and 30 June 2025.”
So, that’s an overview of fodder storage write-offs!
Next up, is the RIC drought loan.
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Regional Investment Corporation (RIC) Drought Loan
The Drought Loan is intended to assist primary producers with drought preparation, management and recovery.
This could include using the loan for activities and infrastructure such as fodder storage, water cartage and restocking (when seasonal conditions allow).
For example, read this article on how Michelle and John Hassell used the improved cash flow from the RIC loan to build a large fodder storage shed – Farmers Use RIC Loan To Speed Up Drought Management Plans To Prepare For Dry Conditions
What Are The Loan Terms?
The 2025 RIC Drought Loan terms include:
- $2 million maximum amount
- 5.18% variable rate (reviewed every six months)
- 10-year term
- 5 years interest only
Learn about the terms in full here.
Am I Eligible? How Do I Apply
Before you apply it is recommended that you understand the eligibility criteria and understand the terms of the loan.
For example, you will need to have a drought management plan, and your business cash flow budget documented.
You can learn about eligibility requirements here.
There are also a number of helpful resources available which we have listed below.
RIC Drought Loan Resources
That’s a summary of the RIC Drought Loan which can be used by eligible primary producers across Australia.
The rest of this article covers fodder storage loans and grants available in Queensland, New South Wales, South Australia and Victoria.
We have also included some useful resources such as pricing guides to help you with your fodder storage project planning and budgeting.
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QRIDA Drought Preparedness Grant
The Drought Preparedness Grant is intended to assist primary producers in Queensland to “undertake new permanent infrastructure activities that will improve the drought preparedness of their property.”
Primary producers can now apply for a grant of 25% of the cost of new permanent capital infrastructure to a maximum amount of $50,000 over five years.
Examples of what this grant could be used for include:
- “Storage, mixing and feeding out equipment for grain, fodder, molasses and other supplements.
- Grain storage and equipment that improves the ability of the business to manage drought.”
The Queensland Rural and Industry Development Authority also provide this example:
“By completing their Farm Business Resilience Plan, Jamie knows that installing three large feed storage sheds will assist with protecting their farm from drought.
After seeking quotes for these sheds, they find it will cost $230,000 to build. Jamie decides to apply for a Drought Preparedness Grant to cover up to 25% of the cost to a maximum of $50,000.
Applying through QRIDA, they submit their quotes and Farm Business Resilience Plan for review. Meeting all the eligibility criteria, Jamie is approved for the Drought Preparedness Grant and receives $50,000 as it does not exceed 25% of the cost of the capital infrastructure they wish to build. This money will now go towards building the feed storage sheds.”
Will I Be Eligible?
Learn about eligibility requirements, here.
What Else Do You Need To Know?
A QRIDA Sustainability Loan can be used as the co-contribution to the Drought Preparedness Grant for implementation activities.
We discuss the Sustainability Loan next.
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QRIDA Sustainability Loan
“A Sustainability Loan can help you secure the future sustainability of your existing Queensland based primary production business.”
The loan can be used to “undertake drought preparedness activities and invest in infrastructure that improves drought and disaster preparedness.”
What Are The Loan Terms?
- $1.3 million maximum loan amount
- Up to 20-year loan terms
- Low variable and fixed rates for 1, 3 or 5 years (learn about these here)
You learn more about the loan, including guidelines, cashflow spreadsheets and how to apply here.
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QRIDA Drought Ready & Recovery Finance Loan
“The Drought Ready and Recovery Finance Loan offers up to $250,000 to help primary production businesses undertake drought ready and recovery activities and improve drought resilience.”
What Can The Loan Be Used For?
The loan can be used for implementing grain storage and fodder storage.
Download the guidelines, here, to view the complete list of eligible activities.
The QRIDA also provides this example:
“After receiving a Drought Preparedness Grant of $50,000, Jamie is excited to start building the feed storage sheds. However, they still need to fund the remaining $170,000.
Hearing about the Drought Ready and Recovery Finance Loans available of up to $250,000 through QRIDA, Jamie chats to their Regional Area Manager about whether the loan could fund the remainder of the shed.
After submitting all the required documentation and meeting eligibility criteria, Jamie is approved for a concessional loan of $170,000. They now have 10 years to pay this money back, with interest-only payments for the first two years.”
Will I Be Eligible?
Eligibility requirements include demonstrating at least one person in the primary production business is a primary producer and presenting a Farm Business Resilience Plan satisfactory to QRIDA.
So, that’s three loans and grants that could be taken advantage of for fodder storage assets in Queensland.
Alternatively, you may be eligible for the Disaster Assistance Loan available in Queensland, which you can learn about here – Grants & Loans For Farm Sheds In Queensland
Next up is information on the Rural Assistance Authority (RAA) Drought Ready & Resilience Fund available in NSW.
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RAA Drought Ready & Resilience Fund
The Drought Ready and Resilient Fund allows eligible primary producers in NSW to access a low-interest loan of up to $250,000 to help prepare for, manage and recover from drought.
For example, this could be used for activities and infrastructure such as water cartage, weed control and hay sheds, grain silos or silage pits for fodder storage.
Applications will be accepted until funding is exhausted.
Are You Eligible?
DPI NSW provides an overview of eligibility requirements, here.
You can also download the guidelines – Drought Ready & Resilient Fund Guidelines (PDF download)
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South Australia’s On-Farm Drought Infrastructure Rebate Scheme
The South Australian government have introduced an infrastructure rebate for “primary producers to implement infrastructure projects that assist with managing current drought conditions and strengthen preparedness for future droughts.”
The maximum rebate amount is $5000, and applicants must contribute at least 25% of the total infrastructure cost.
The rebate can be used for activities and infrastructure such as:
- Setting up stock containment areas
- Irrigation upgrades
- Fodder storage
Am I Eligible?
There are a number of eligibility requirements to meet which you can learn about here.
You can also download the Program Guidelines to help determine whether the rebate is a right fit for you – On-Farm Drought Infrastructure Rebate Scheme Guidelines (PDF download)
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Victoria’s On-Farm Drought Infrastructure Grant
The Victorian government introduced a Drought Support package at the end of 2024 which included $12.1 million for drought infrastructure grants.
Grants of up to $5000 are available to eligible farmers in eligible LGAs to help them prepare their properties for drought conditions.
Note that a dollar-for-dollar co-contribution is required by the grant recipient.
Eligible activities and infrastructure include:
- Water storage
- Fodder storage
- Stock containment areas
- Soil moisture monitors
Which Local Government Areas Are Eligible?
According to Agriculture Victoria, “the grants are open to farmers in Local Government Areas (LGAs) in the south west that have been most severely impacted.”
The LGAs include:
- Ararat
- City of Greater Geelong
- Colac Otway
- Corangamite
- Glenelg
- Golden Plains
- Moyne
- Pyrenees
- Southern Grampians
- Surf Coast
- Warrnambool
- West Wimmera (Postcodes 3312, 3317, 3318 and 3319)
You can learn more about the grant including eligible activities and how to apply here.
And that’s a wrap on fodder storage write-offs and funding available in 2025! We’ve also listed some additional resources below to help you with your project planning.
Useful Resources
- 9 of The Best Hay Shed Kit Sizes & Prices
- How Much Does It Cost To Build A Grain Shed?
- Grain Sheds Versus Silos (Pros, Cons & Prices)
- Latest NSW Farm Sheds Brochure (PDF Download)
- Latest SA Farm Sheds Brochure (PDF Download)
- Grain & Hay Storage Calculators
- Lamb Feedlots Are The Future & You Should Cover Yours
Fodder storage is an excellent addition to help make your enterprise more drought-ready and resilient. Plus, you can prove the benefits of this infrastructure year after year.
It can also make good financial sense to take advantage of the fodder storage write-offs, funds and loans available to reduce your tax payable and improve cashflow. So, we hope this overview has been helpful.
And if you have a fodder storage project on the cards, reach out to our team on 1800 687 888 – would love to hear from you.
