How your business can take advantage of the instant asset write-off
6 May 2020
The Australian Federal Government's announcement on 12 March 2020, outlined an Economic Stimulus Package to help businesses respond to the impacts of the COVID-19 pandemic.
The package includes an incentive for businesses to invest in equipment. Referred to as the Instant Asset Write-off, it allows businesses that invest in vehicles and equipment between now and 30 June 2020, to claim a one-off tax deduction on individual assets.
Here's some key information for you to consider from the announcement:
Claims can be made on any number of new and used assets, so long as the individual asset value is less than $150,000.
The write-off applies to businesses turning over an aggregated amount of less than $500 million per annum.
Policy includes business assets which are first used or installed for use in the period from now until 30 June 2020.
The purchase and claiming period ends on 30 June 2020.
For investments of $150,000 or more, businesses can deduct 50 percent of the asset cost in the first financial year of service providing it's installed before 30 June 2021.
You may be able to finance under a chattel mortgage agreement and still claim the benefits of the instant asset write-off this financial year.
One strategy Findex advisers have been using to help trading during this testing period is to top up your cash reserves by trading-in your current asset and placing these funds into your account.
Then you can finance the new piece of equipment and have the peace of mind of a warranty while enjoying better efficiency, less repairs and maintenance.
If you require any assistance understanding how to take advantage of the instant asset write-off, get in touch with the Findex Lending team who can provide expert advice and strategies.
Findex has developed a Government Stimulus Health Check and free Business Wellbeing Toolkit to help businesses manage potential risks and take full advantage of eligible stimulus assistance. Book your Health Check here.