From between 7:30pm (AEDT) on the 2nd of April 2019 through the 30th of June 2020 the threshold for the instant asset write off has been increased to $30,000. This is great news for small business! However, the offer has led to plenty of confusion. This means that some businesses are missing out this great tax break.
If your business has a turnover of less than $10 million, you can instantly claim the business portion of most new or second-hand assets that cost less than the $30,000 threshold per item. Businesses can now claim a deduction (providing the asset is $30,000 or under) in the same financial year as they bought it instead of the ongoing depreciation rules that previously applied.
This deduction is able to be claimed on the business’s tax return.
Tracey owns an accounting firm. She purchased a new business computer in May 2019. The total came to $6,000. She also bought new printer for $600. Her instant asset write off comes to a combined total of $6,600.
Tracey includes the combined amount of $6,600 at table A of the Business and Professional Items Schedule which is filled out when completing her 2019 tax return.
If you purchase an asset (new or second hand) costing less than $30,000 and it is used or installed ready for use from 7:30pm AEDT on 2 April 2019, you can claim a deduction for the business portion. Tax deductions are certain expenses you incurred in order to earn your income. Deductions reduce your taxable income before the tax is calculated.
With just over a month remaining between now and tax season, there is still plenty of time to take advantage of this instant asset write-off. It is a great time to look at upgrading your IT systems and printers.
Get in contact with Rule Technology Sales for a quote today:
or call 1300 823 226
For more information on the instant asset write-off visit the Australian Taxation Office website or speak to your accountant or a qualified tax professional.