Unless you’ve been living under a rock, you’ll know about the instant asset write-off scheme that the Federal Government is offering to small businesses through the 2017/18 Federal Budget (and extended into 2018/19).
But it occurred to me today that actually a lot of business owners are kind of living under a rock – there’s so much you need (and want) to do for your business that it’s ‘head down bum up’ a lot of the time. And when you get the chance to raise your head, you realise quite a lot has happened around you with you even noticing.
So just in case that’s you, here’s a quick summary of what you need to know. You might want to take advantage of the scheme this financial year to improve your tax position too (which means do it soon!)
Introduced by the Federal Government in 2015, the instant asset write-off scheme allows small businesses to claim immediate deductions for assets up to $20,000 (that’s per asset, too). If you’re a registered business with an ABN, and your business turnover is up to $10 million since 1 July 2016, you can claim the instant write-off, which means you reduce your taxable income in that financial year rather than depreciating the asset over a number of years.
There’s no limit on the number of items a business can claim. Plus you can use the scheme to buy used (second-hand) assets too.
It’s important to note that while you can claim instant deductions on a huge range of assets (from vehicles to fridges to lawnmowers to hot water units to security systems and so on), some things, like horticultural plants and in-house software, are not eligible, so make sure you check before making any large purchases.
In even more good news, you can access finance to procure these assets, which allows you to take advantage of the scheme (and the tax benefits) without impacting on your cash flow. So it’s a win win!
If you’re ready to introduce updated assets into your business, give me a call on 0412 534 503 to discuss your options today.