With the 2016-17 Federal Budget approaching fast, R&CA is reminding small business owners that they are able to claim an immediate tax deduction for assets that cost less than $20,000. These changes apply to assets acquired between 12 May 2015 to 30 June 2017.
Any small business with an aggregated turnover less than $2 million may be eligible to claim an immediate deduction for the cost of depreciating assets acquired for less than $20,000. New laws have passed that allow small businesses to claim an immediate deduction for assets they start to use—or have installed ready for use—provided each depreciable asset costs less than $20,000. This will temporarily replace the previous instant asset write-off threshold of $1,000. Assets that cost $20,000 or more (which can’t be immediately deducted under other provisions) are deducted over time using the general small business pool. Under the pooling mechanism a deduction for 15 per cent of the cost is allowed in the first income year with a diminishing value rate of 30 per cent deduction on the opening pool balance allowed for each income year thereafter. The balance of the general small business pool is also immediately deducted if the balance is less than $20,000 at the end of an income year that ends on or after 12 May 2015 and on or before 30 June 2017 (including existing general small business pool). If you are thinking of upgrading or purchasing new equipment for your business, now is the perfect time to speak to R&CA’s partners and associate members to see what they can offer you: Alsco – linen, work wear and industrial cleaning Comcater – industrial cooking equipment, fryers, grills + more Commonwealth Bank – commerical, asset & vehicle finance Di Bella – coffee machines H & L Australia – point of sale and reservations systems For information about the operation of the instant asset write-off you can ring 13 28 66.