7 August 2017

Extension to Instant Asset Write-off for Small businesses

Ammann vibratory plate

The Australian Taxation Office has made the decision to extend the instant asset write-off, allowing small businesses the immediate deductibility for eligible assets costing less than $20,000 purchased by 30 June 2018. The immediate write off applies to small business entities with an aggregated turnover of less than $10 million.

What this means

If your business turns over less than $10 million per year and you make a purchase of an asset for less than $20,000 (excluding GST), whether new or second-hand, before 30 June 2018 the asset can be claimed as an expense, rather than slowly depreciating it over a set amount of years. There is also no limit to how many assets you can claim the deduction for. 

What machinery would you be able to claim

Smaller equipment and attachments which compliment your excavators and other machinery including, Ammann compaction equipment, buckets and other attachments, selected used equipment, tracks and parts can all be claimed as part of the scheme.

How does the instant asset write-off work

For Example, if a business/company has to purchase a machine at a cost of $21,000 (including GST), the tax benefit is as follows:

  • $1,909 GST refundable
  • Tax saving at 27.5% (company tax rate) due to the immediate deduction - $5,250
  • Total cost of a $21,000 asset after tax saving = $13,841

For more information on the extension to Instant Asset Write-off see the Australian Taxation Office Website or consult your Accountant