From 2 April 2019 (Budget night), the Government has increased and expanded access to the instant asset write-off by increasing the instant asset write-off threshold from $25,000 to $30,000. The threshold applies on a per asset basis, so eligible businesses can instantly write off multiple assets. If you are looking to purchase an asset for your business, the Instant Asset Write-Off has now been extended to $30,000, advantageous for small and medium businesses.
Medium sized businesses will now also have access to the instant asset write-off. The increased and expanded instant asset write-off will apply from Budget night until 30 June 2020.
Small businesses (with aggregated annual turnover of less than $10 million) will be able to immediately deduct purchases of eligible assets costing less than $30,000 that are first used, or installed ready for use, from Budget night to 30 June 2020.
Medium sized businesses (with aggregated annual turnover of $10 million or more, but less than $50 million) will also be able to immediately deduct purchases of eligible assets costing less than $30,000 that are first used, or installed ready for use, from Budget night to 30 June 2020. Medium sized businesses must also acquire these assets after Budget night to be eligible as they have previously not had access to the instant asset write-off.
Arrangements prior to Budget night
The Government had already legislated a $20,000 instant asset write-off for small businesses. Eligible small businesses could already immediately deduct purchases of eligible assets costing less than $20,000 that are first used or installed ready for use by 30 June 2019.
On 29 January 2019, the Government announced that it would increase the instant asset write-off threshold for small businesses from $20,000 to $25,000 and extend the instant asset write-off for an additional 12 months to 30 June 2020.
These changes interact with the changes announced as part of the Budget. This means that, small businesses are able to immediately deduct purchases of eligible assets costing less than $25,000 that are first used or installed ready for use over the period from 29 January 2019 until Budget night.
If you would like any further information or advice on purchasing assets for your business and the deductibility of these assets, please contact the experts at DGL Accountants.