EOFY 2022: How to Help Your Business with Instant Asset-Write Off

The Australian Government reported the expansion of instant asset write-off scheme as part of the 2022 Federal Budget. This eliminated the $150,000 per asset limit because of the effect of the COVID-19 pandemic.

 

The $150,000 Instant Asset Write Off:

• Applies to any asset that can be utilised for business purposes with a cost of $150,000 or less (excl. GST)
• Assets should be bought and introduced from March 12 to December 31, 2020 (extended, and will complete on 30 June 2021)
• Assets can be new or second hand
• $150,000 limit for every individual asset and subsequently numerous assets (amounting to more than $150,000) can be obtained under this initiative
• No restriction to how much assets acquired

 

$150k Instant Asset Write Off – How It Can Help You and Your Business

 

Qualified organisations can guarantee an immediate deduction for a fraction of the cost of their business’ asset. This is based on the year that the asset is first used or introduced. However, the eligibility criteria have changed over time. You can look of your business’ qualifications and apply the correct limit amount depending on when your asset was acquired, first utilised or prepared for use.

Download EOFY Questionnaire.

 

How does the instant asset write off work?

The instant asset write off is available for Australian organisations with a turnover of up to $5 billion. It is like a booster for your depreciation that reduces the “ordinary” timetable an asset would be devalued over, helping you understand your benefit of tax reductions.

 

What’s the most ideal way to guarantee a vehicle assuming you are maintaining your own business?

The first and most critical thing to do is to ask your accountant about the instant asset write off. They can give you the best financial advice.

Suppose for instance you have a small business with an annual turnover of $600,000 and you need to update your vehicle and working apparatus. On the premise the assets are qualified, you can claim an immediate tax deduction for the financial year.

The stamp duty and other on-road costs are included in the vehicle’s price. Remember, you cannot exceed to $150k in total value for any single asset including your vehicle.

You can check the eligibility of your business for instant asset write off scheme from the ATO website.

 

How about the accessories like signages and when do these all need for accounting? 

Accessories are included in the vehicle’s asset value if installed by the dealer during the purchase. Temporary full expensing is open for qualified assets that are first used or installed prior to 30 June 2023 under the 2022 Federal Budget.

 

Is there a limit under the instant asset write-off?

The instant asset write-off is applicable to motor vehicles with a car limit valued up to $60,733 in the 2021-22 financial year.

 

What proof do you need?

It is important to keep a record of all your purchases. This includes the date it was purchased and paid. This will lessen the taxable income.

 

What is the next thing you can do?

This is the best time to build or grow your business!

Discuss your eligibility for these initiatives and find out how to take full advantage of the low interest rates with Success Accounting Group. Speak to one of our accountants or financial advisors today!

And if you would like to apply for a motor vehicle financing for your business or personal use, please contact Khang Pham – our Success Finance Broker.

 

 

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