Take advantage of the $30K instant asset write-off!
The instant asset write-off threshold has been increased from 2 April 2019 to $30,000 and extended to 30 June 2020.
Different thresholds apply for assets purchased before that date: Assets purchased from 29 January 2019 until before 7.30pm AEDT on 2 April 2019, the threshold is $25,000; and before 29 January 2019, the threshold is $20,000.
From 2 April 2019, the instant asset write-off has also been expanded to include businesses with a turnover from $10 million to less than $50 million.
If you’ve been considering taking advantage of the instant write off, but waiting to see how your bottom line looks, now could be the time to make the decision to make an investment in your business that will help reduce your taxable income. Cashflow is an important consideration, and just like any business decision the motivating factor should not be the tax benefit alone. Ask yourself if you really need the asset and do you have the funds available, if cashflow permits and you need the asset then you should consider making your purchase before 30 June 2019.
You can apply the $30,000 immediate write-off to multiple individual new or second-hand asset purchases, meaning that small businesses could add several items together and claim the maximum deduction. But remember this is the tax deduction, not the actual tax saving. The tax saving will depend on your effective tax rate.
Eligible assets: Basically all depreciable assets (including second-hand assets) used in a business are eligible, including; motor vehicles, plant & equipment, computer equipment, office or shop furniture, website, signage, tools, sheds etc. Just remember the asset needs to be genuinely used in your business and the total cost of the asset must be below the $30,000 threshold.
Before you make any big purchase decisions it is best to have a chat with us first to review your tax position and ensure that you are eligible for the concessions. We can also assist with arranging finance should you require, if you’d like to discuss your options give us a call on (03) 5976 4082
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