Issue 38 2015

Write-off up to $20,000 immediately

Deductions put more money in your budget

As part of the May 2015 federal budget the Australian Government announced that small businesses with an aggregated turnover under $2 million would be entitled to claim a $20,000 instant asset write-off.

The new $20,000 instant asset write-off means that assets valued less than $20,000 can be claimed as an immediate tax deduction from 7:30pm on the 12th of May 2015 until the 30th of June 2017.

Small businesses can use this instant asset write-off for any depreciable plant and equipment asset or fit-out installed in a business. Examples of deductible items which can be claimed range from office furniture, blinds, workstations and light fittings to more specific industry assets such as hospitality, medical or manufacturing equipment.

Assets acquired between the 12th of May 2015 and the 30th of June 2017 may be placed in a general small business pool and depreciated. Where the balance of the pool is less than $20,000 at the end of the financial year, the remaining un-deducted value can be claimed as a deduction in that year.

Businesses which purchased assets between the 1st July 2013 and 31st of December 2013 are still eligible to apply the $6,500 instant asset write-off which the previous government implemented.

It is important to note that assets outside the $20,000 threshold for small business owners and tenants are still able to be claimed based on their individual depreciable rate as set by the Australian Taxation Office.