Thinking of purchasing assets for your business? The instant asset write-off has changed. It’s been:
• expanded to include more businesses
• increased to $30,000 for each asset
• extended until 30 June 2020

Please contact Arora Accounting Services your local North Lakes Accounting practice to enquire more about instant asset write-off.

Using the simplified depreciation rules, assets costing less than the relevant instant asset write-off threshold are written off in the year they are first used, or installed ready-for-use. This threshold applies to each asset irrespective of whether the asset is purchased new or second-hand.

The threshold has changed over the last few years and during the current year as shown in the table below.

Instant asset write-off thresholds
Date range Threshold for each asset
7:30pm (AEDT) 02/04/2019 to 30/06/2020

$30,000

29/01/2019 to before 7.30pm (AEDT) 02/04/2019

$25,000

7.30pm (AEST) 12/05/2015 to 28/01/2019

$20,000

01/01/2014 to prior to 7.30pm (AEST) 12/05/2015

$1,000

01/07/2012 to 31/12/2013

$6,500

01/07/2011 to 30/06/2012

$1,000

 

The entire cost of the asset must be less than the instant asset write-off threshold, irrespective of any trade-in amount. Whether the threshold is GST exclusive or inclusive will depend on your GST status, for further information about GST impacts see Cost.

In working out the amount you can claim, you must subtract any private use proportion. The balance (that is the proportion used in earning assessable income) is generally the taxable purpose proportion. While only the taxable purpose proportion is deductible, the entire cost of the asset must be less than the threshold.

Note that if you later sell or dispose of an asset for which you claimed an instant asset write-off, you include the taxable purpose proportion of the amount you received for the asset in your assessable income.

Credit: https://www.ato.gov.au/Business/Depreciation-and-capital-expenses-and-allowances/In-detail/Depreciating-assets/Simplified-depreciation—rules-and-calculations/?page=4#Instant_asset_write_off

Image Credit: Australian Taxation Office

Please contact Arora Accounting Services to enquire more about instant asset write-off. Call 0426 199 277 or email [email protected]