EOFY Small Business Alert: New rules for immediate write-offs

There are new simplified depreciation rules in force which entitle small businesses to an immediate deduction for low-cost assets in the year they are first used or installed ready for use for a taxable purpose.

Thanks to recent changes, small business entity ('SBE') taxpayers may be entitled to an immediate deduction in the 2019 income year for acquiring certain depreciating assets costing up to $30,000 (net of entitlement to GST input tax credits) for assets used or installed ready for use from 7:30 pm AEST on 2 April 2019 until 30 June 2019.

Assets acquired prior to 2 April 2019 may also be eligible for immediate write-off, however the thresholds may be lower (e.g., the threshold is $20,000 for assets used or installed ready for use from 1 July 2018 until 28 January 2019, and $25,000 for assets used or installed ready for use from 29 January 2019 until 7:30 pm on 2 April 2019).

In addition to this, for the first time, medium sized businesses (which have an aggregated turnover of less than $50 million) may also be eligible to claim an immediate deduction for acquiring assets from 2 April 2019.

If you have a small or medium sized business and are wondering if these new rules apply to you, get in touch and we will help you work it out.