Instant asset write-off extension for small businesses

The Morrison Government continues to back small business with the announcement that it will extend the $150,000 instant asset write-off for six months to 31 December 2020.

Australian businesses with an annual turnover of less than $500 million will be able to take advantage of this extended timeframe to invest in assets to support their business as the economy reopens and Coronavirus health restrictions continue to be eased.

These measures will support over 3.5 million businesses employing more than 9.7 million employees. They 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.

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. Assets can be new or second hand and could include for example a truck for a delivery business or a tractor for a farming business.

Businesses that adopt substituted accounting periods will also be able to benefit from the $150,000 instant asset write-off, providing all other eligibility requirements, including with respect to the date of purchase and installation or use of assets, are met.

Legislative changes will be made to give effect to this measure, which is estimated to have a cost to revenue of $300 million over the forward estimates period.

For more information and eligibility visit: https://www.ato.gov.au/Business/Depreciation-and-capital-expenses-and-allowances/Simpler-depreciation-for-small-business/Instant-asset-write-off/

 

SHARE THIS ARTICLE

FURTHER READING

Retail Voice CEO Message: 20 March 2024

This week, the extension of the Paid Parental leave scheme was passed in the Senate, allowing new parents to take half a year of paid parental leave by mid-2026. This

An Earth Choking on Plastic

While as humans we can be visionary, we often lack imagination, and ultimately suffer for our short-sightedness. Plastic waste has emerged as one of the most pressing environmental challenges of

Retail Voice CEO Message: 13 March 2024

It was wonderful to see so many from our retail community participate in the ARA International Women’s Day lunch event in Melbourne last week, culminating in the announcement of the ARA CEW Women

Anzac Day Trading Hours 2024

The following is a state by state breakdown of the public holiday information for Anzac Day 2024. When is Anzac Day 2024? Anzac Day is on Thursday, 25th of April