Do you own a small business? Have you been planning any significant purchases?
If so, the great news is: you have another 12 months to take advantage of the $20,000 instant asset write-off scheme!
This tax break only applies to small businesses with an aggregated turnover of less than $10 million.
This Budget initiative means that as a small business owner, you get to improve your cash flow and boost your business activity and investment for another year.
How does this work?
If you buy an asset to use for business purposes and it costs less than $20,000, you can immediately deduct the business portion of the cost in your tax return.
This deduction is used for each asset that costs less than $20,000.
You would then claim the deduction through your tax return, in the year the asset was first used or installed ready for use.
Jane owns a plumbing business. She buys five new laptops for her employees. Jane can take advantage of the $20,000 instant asset write off for all of these items because each individual item costs less than $20,000.
Jane also buys five second-hand mobile phones for her employees. The mobile phones are 50% for personal use and 50% for business use. This means only half the full amount of the iPhone can be claimed.
|You can use the $20,000 instant asset write-off multiple times. However, each one must cost less than $20,000.
Don’t forget that purchases will only qualify if they total $19,999.99 or less, including GST!
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