Yesterday the Federal Government announced the extension of the $150,000 instant asset write-off scheme until 31 December 2020 – and 3.5 million Australian businesses are set to benefit.
Under instant asset write-off eligible businesses with an aggregated turnover of less than $500 million can claim an immediate deduction for the business portion of the cost of an asset in the year the asset is first used, or installed ready for use.
Instant asset write-off can be used for:
“[These measures] are designed to support business sticking with investment they had planned, and encouraging them to bring investment forward to support economic growth over the near term,” said Treasurer Josh Frydenberg in a joint release with Minister for Employment, Skills, Small and Family Business Michaelia Cash.
“The instant asset write-off also helps to improve cash flow for businesses by bringing forward tax deductions for eligible expenditure. The threshold applies on a per-asset basis, so eligible businesses can immediately write off multiple assets provided each costs less than $150,000.
“The extension will also give businesses additional time to acquire and install assets, as they will now have until the end of the year.”
Without the extension, the instant asset write-off threshold of $150,000 would have reverted to the $1,000 threshold and eligible only to small businesses with a turnover of less than $10 million after 30 June.
Legislation to give effect to the extension to the instant asset write-off will soon be introduced.
Should you have any questions or need any help ensuring you receive all available assistance, please reach out to our team and we will endeavour to do our best to assist.
The Team at Rose Partners