So whilst we are all racing about like headless chooks dealing with Job Keeper here I am today asking you to examine your asset purchasing strategy as soon as you can.
The $150,000 Asset Instant Write Off has been extended until 30th June 2021 as of 9th June 2020. PHEW.
Here are a few things to include in your calculations when taking advantage of the $150,000 Asset Instant Write-off.
- It must be for an asset that is used by the business.
- You need to include all the elements of the asset when working out the threshold – for example if you were to buy a table and chairs – the set cannot be split into each chair plus the table so each element is under the threshold.
- It’s only a handy tax strategy if you think you will be making a good profit for the 2020 year – else the deduction won’t bring you any tax savings.
- Given we have no idea what will happen with the current economic climate – it might not be wise to commit a large sum to an asset purchase.
- If purchasing a car for the business – you are still limited to $57,581 despite how much more the car cost. Note that a car is defined as passenger vehicle and not a one-tonne Ute, van, truck or motorcycle. If you are unsure in regarding to your vehicle purchase please check with your Tax Agent or the ATO.
- Any asset you purchase in the 2020 financial year has to have arrived and be installed at your workplace ready to be used. Given some orders may take some time to fill, you should always check with the supplier what date they can ensure your asset purchase arrives by.