Are you in need of new office furniture, computers, printers, vehichle, tools etc? Now may be the time to purchase..
The instant asset tax write-off has been available to small-business (with a turnover of less than $10 million) for the last few years. It allows a business instantly claim a tax-deduction instead of claiming deductions over a number of years.
In January, the Prime Minister announced that the threshold would increase to $20,000, then as part of the Federal Budget in April, the amount was again increased to $30,000.
There are now 2 key changes to the instant asset write-off rules:
- Write-off has been extended to medium businesses, where it was previously only small business. Medium businesses have annual turnover of between $10 million and $50 million.
- Write off threshold increasing from $25,000 to $30,000. This is a per-asset basis, so eligible businesses can instantly write-off multiple assets. The $30,000 write-off is for assets first used, installed and ready for use from Budget Night (2nd April 2019) until 30 June 2020.
There are a few different dates to be aware of, so it’s important to chat to us about your eligibility and what you are able to claim as the purchase date is critical.
So, you do still have time to make a purchase before the end of this financial year to be able to write-off that asset up to the $30,000 limit (ensuring your eligibility of course).
What to be careful of
It’s really important to remember that saving tax is great – we all love to do it – however it’s not worth spending money on an asset just to save tax. You really have to have a need to purchase the asset. The purchase of the asset should be leading to higher profitablity, better productivity or benefiting the business going forward.
As the financial year is coming to an end, if you are still considering purchasing any asset’s to potentially utilise the write-off, please get in touch with us as soon as possible so we can ensure you get the best outcome.
For more information, see the ATO website.