How small businesses can save tax by purchasing assets [May 2019] | Melwood Timber Cabins & Sheds

How small businesses can save tax by purchasing assets [May 2019]

How small businesses can save tax by purchasing assets [May 2019]

Did you know you could save tax by purchasing assets for your small business this financial year?

The Australian Government has increased & extended the Instant Asset Write-Off incentive for small business. 

If you buy an asset and it costs less than $30,000, you can immediately deduct the business portion in your tax return.

 

Who is eligible?

The ATO states that you are eligible if:

  • you have a turnover of less than $10 million (increased from $2 million on 1 July 2016), and
  • the asset was first used or installed ready for use in the income year you are claiming it in.

 

What kind of assets?

This could be almost any claimable business asset such as a vehicle, a fridge, a coffee machine or even a portable storage shed.

For example, Andrew bought a small excavator for $28,000 which is used by his landscaping business. As the depreciating asset cost less than $30,000, Andrew is able to claim an immediate tax deduction for his asset. 

 

What about assets that cost $30,000 or more?

Assets that cost $30,000 or more (which can’t be immediately deducted) continue to be deducted over time using a small business pool. 

 

When does the incentive end?

The ATO incentive ends 30 June 2020.

 

More information

For more information on this incentive, speak to your accountant or visit the ATO website

 

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How small businesses can save tax by purchasing assets

How small businesses can save tax by purchasing assets

 

Financial disclaimer-The information provided in this post is general information only. Before acting on this information you should consider the appropriateness of the information, having regard to your own objectives, financial situation and needs. Please consult a professional in that taxation field before proceeding with your purchases that you may use for deduction purposes.



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