There are three types of Income Equalisation Deposit Schemes. Although your accountant can advise you on which of the three schemes would be of benefit to you and how to utilise them, a basic understanding of the schemes gives you better control over your business decisions.

#3 Adverse Event
This Income Equalisation Deposit Scheme acts like a safety net in the event of a self-assessed adverse event or a regionally-declared adverse event such as sickness or disease among livestock, or a flood, fire, drought, or any other natural event or calamity.
In this scheme, anyone engaged in an agricultural or farming business can make deposits to an Adverse Event Income Equalisation Deposit account.

The general rules are as follows:
● The farmer or taxpayer must present a statutory declaration (an IR139) to the Commissioner;
● Qualifying deposits should be made not more than a month after the balance date;
● In this scheme, deposits can be withdrawn immediately (because adverse events cannot be controlled). If they remain untouched after 12 months of being deposited, they are transferred to your main Income Equalisation Deposit account;
● You cannot simply deposit any amount you want. The maximum deposit is subject to rules as stated in Section EH 61 of the Income Tax Act of 2007. It really is wise to consult your accountant about this;
● The interest rate for this scheme is more than twice than the ordinary scheme as it is set at 6.5%;
● The year of the refund is the tax year where the refunds are deemed assessable. This is also the year when the Commissioner receives the application for a refund from you; and last but certainly not the least,
● All the provisions which apply to the Income Equalisation accounts on the event of bankruptcy, death, liquidation, or retirement of a corporate taxpayer also apply to deposits made under the Adverse Event scheme.