Some of them are in favor of the taxpayer and some of them are not. We will discuss one of the key changes.
Instant Asset write-off: Temporary full expensing has ended as of 30 June 2023. However, eligible businesses can claim an instant tax deduction for assets which is less than $20,000 that will be used for business.
1. The entity must carry on a business; and
2. Business has Aggregated turnover is less than 10 million;
1. Asset cost to be less than $20,000 exclusive of GST;
2. Asset by asset basis i.e. business can buy multiple assets cost less than $20,000;
3. Asset must be used or ready to use within the financial year i.e. delivered and ready use by 30 June 2024 to claim the full depreciation;
4. Second-hand asset is eligible too.
1. Entity must use simplified depreciation rules for 2024 FY. If it does not use it, it is not eligible to apply instant asset write-off.
The instant asset write-off proved to be a small business-friendly tax policy that let the taxpayer invest in asset and claim an immediate tax deduction.
If you would like to know more or want to discuss further, please call Jit on 02 -7726 9183 or book a Meeting here.
Written by Jit Chowdhury CA,
SMSF Auditor
CA SMSF Specialist