$20,000 instant asset write-off ceases 30th June 2017 (or does it?)

Note: Since the publication of this article, it was announced in the 2017 federal budget the governments intention to extend until 30/06/2018. This however does not become law until it is passed by both houses of parliament and received royal assent. There can be no guarantees on passing, and even if it does pass it may not be until after the 30/07/2017. 

This article is based on the legislation as it currently stands as at 19/05/2017.

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The “Accelerated Depreciation” threshold of $20,000.00 will not apply after midnight June 30, 2017.

For the purposes of this article all references are to businesses with a turnover of less than $10M and all values are GST exclusive.

If you are going to invest into an asset exceeding $1,000.00 but less than $20,000.00 in the next year or two it would be wise to consider bringing it forward to this financial year. As of 1 July 2017 any expenditure in this range reverts to depreciation rather than immediate write-off.

As usual with any tax legislation there are boxes to tick:

  • Grouping does not apply. If you buy 10 computers for $2,100.00 each, they are set for immediate write off.
  • Applies to new and second hand assets.
  • Asset must be installed and ready for use by midnight 30 June 2017. So ordering something at 4:55pm on June 30 2017 will probably not work.
  • Asset must be complete. Invoicing the front half of the car will not fly.
  • There are some exemptions e.g. horticultural plants and assets for hire
  • It only applies to assets with a tax (business) purpose.
  • Contrived schemes will be excluded

 If you have any concerns call Shane Holbeck on 07 3483 0103.

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