A reminder to our clients that the $20,000 threshold has been extended to 30 June 2019. It now means that you only have less than six months to make use of this initiative.

As small business, if you buy or finance an asset and it costs less than $20,000 (after GST) then may be eligible to write the full amount off for the business portion when we prepare your business tax return for the relevant income year.

To be eligible to use simplified depreciation rules and claim an immediate deduction the following rules apply:

  • you had a turnover less than $10 million  and
  • the asset was first used or installed ready for use in the income year that you are claiming the deduction.

Assets can be new or second hand and it is a requirement that the total asset meets $20,000 limit , per asset.

Assets that cost $20,000 or more can’t be immediately deducted and must be depreciated per the normal rules for the small business pool.

You may write off the balance of this pool if the balance before applying any other depreciation deduction is less than $20,000 at the end of an income year.

The $20,000 threshold applies from until 30 June 2019. After this date , it reduces to $1,000 on 1 July 2019. So jump in and plan any equipment purchases now rather than later in 2019.

About Geoff Gartly

Geoff has been assisting businesses with their taxation and business affairs for many years. His practical advice has assisted his clients to grow their businesses and plan their financial future. To contact Geoff please call 039597 9966