Instant asset write-off extension welcomed by business
A SIX month extension of the Federal Government’s instant asset write-off scheme has been welcomed as much-needed good news by the state’s peak business organisation.
Business NSW regional manager Jane Laverty said the extended date for the write-off program would encourage businesses to invest in equipment and technology and support them to withstand and recover from this period of volatility.
“Instead of having assets depreciate over several years, businesses’ are now able to write off the depreciation immediately rather than over a longer period of time. This means local businesses with a turnover less than $500 million can purchase from local providers, boost the economy, increase productivity and get tax relief,” Mrs Laverty said.
“As restrictions continue to lift we will start to see more optimism and opportunities for business to implement their COVID-19 recovery plans, retooling and potentially pivoting or introducing a new offering.”
Mrs Laverty said the increased instant asset write-off, which went from $30,000 to $150,000 in response to the coronavirus pandemic, could be used in a number of ways
“With many businesses now reviewing how they operate within the workplace, this program could be used for an office fit-out, to provide each employee their own laptops to work remotely more often or even introduce a centralised computer system for e-commerce, invoicing and digital receipts,” she said.
“Similarly, our manufacturing businesses which have retooled to meet the PPE shortfalls, manufacturing hand sanitiser or face masks will be able to deduct any assets installed.
“Most tangible assets that decline over time are eligible, including motor vehicles up to $57,581. Among the excluded assets are trading stock items, land, non-farming buildings, and capital works.
“Accelerated depreciation is an important measure to help business invest and grow. The next seven months will provide a good opportunity for business to maximise financing opportunities and contribute back to their local community.”
As part of the early support safety net for business forming part of the Coronavirus Economic Response Package Omnibus Bill 2020 the Federal Government increased the instant asset write-off from $30,000 to $150,000 which has now been extended past its original June 30 date to December 31 2020.
For more information, visit https://www.ato.gov.au/Instantassetwriteoff