A welcomed extension to the instant asset write-off scheme has been announced for the 2018-19 Federal Budget. Australian small businesses will be given extended access to the instant asset write-off for assets worth $20,000.00 or less.
This move by the Australian government will extend accelerated depreciation for small businesses for a further 12 months until the 30th of June 2019.
Small businesses that choose to take advantage of this scheme will need to have the eligible assets used or installed ready for use by the 30th of June 2019. From the 1st of July 2019, the immediate deductibility scheme is set to revert to the $1,000.00 threshold.
During the budget overview, the government stated that this scheme will “improve cash flow for small businesses, providing a boost to small business activity and investment for another year”
You may be eligible to claim the immediate deduction in your tax return for business purchases if you meet the following criteria
- The asset being purchased (new or second-hand) costs $20,000.00 or less.
- You have a turnover of less than $10M
- The asset is first used or installed ready for use prior to the 30th of June 2019
Assets costing more than $20,000.00 will be put into the small business ‘asset pool’ and depreciated at 15% in the first year and 30% each year after the first.
It is important to note that you can depreciate the assets you purchase immediately (for assets costing $20k or less) or at 15% in the first year (for assets costing more than $20k) regardless of when you purchase it during the financial year. With the help of your accountant’s recommendation, this initiative may make buying or upgrading your vehicles & equipment all that more attractive at the end of the financial year.
Brisbane Home Loans Specialists are ready to assist you with your Financing needs so you can take advantage of this Business Initiative.
