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On Tuesday, Australian Treasurer Josh Frydenberg announced that the boosted instant asset write-off program has been expanded for an additional 6 months, until 31st December 2020.
As part of the very first stimulus package announced in March, the Australian Federal government boosted the existing instant assets write-off program from assets worth $30,000 to $150,000 in response to the COVID-19 pandemic.
For those considering purchasing new or used vehicles, machinery, tools or equipment, you can now take advantage of the boosted scheme beyond July 1, 2020. This will allow you to immediately deduct the value of an asset in the year of purchase, instead of claiming deductions over several years. There is no limit on the number of assets you can purchase as long as each is priced below $150,000 and is used or installed prior to the December 31st cutoff date.
“The extension will also give businesses additional time to acquire and install assets, as they will now have until the end of the year. Assets can be new or second hand and could include for example a truck for a delivery business or a tractor for a farming business."
Key points:
- The new rules for the Instant Asset Write-Off scheme will be extended until 31st December 2020.
- Eligible businesses are able to instantly deduct the cost of assets worth up to $150,000
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No limit - multiple assets can be purchased under this scheme and each will be eligible for the write-off
- Available to businesses with an annual turnover of up to $500 million
- Assets can be NEW or USED and must be used or installed by December 31
Interested to know what else you can and cannot claim this tax year? Check out the ATO Tradie Resource Kit for handy tax outlines for the trades and construction sector.
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