On the 12th of March as part of the COVID-19 Federal Government stimulus package, the instant asset write off was increased from $30,000 to $150,000. So any assets purchased after this date under this amount are eligible to be claimed as a full tax deduction provided it is installed and ready for use before the 30th June 2020. As well as increasing the limit, eligibility has been expanded to cover businesses with an aggregated turnover of less than $500 million (up from $50 million).
The original instant asset write off was due to end on 30 June 2020, so the $150,000 extension was due to end on that day too but Treasurer Josh Frydenberg has just made the announcement that this scheme will now be extended an additional 6 months till the end of the year.
Under the original instant asset write off rules, certain motor vehicles are limited to a claim of $57,581 (2019-2020 year). It is important to note that purchasing a car over this limit will still only allow the maximum tax claim of $57,581. There are also other factors to consider such as Fringe Benefits Tax payable when purchasing company cars so if you have any questions, please do not hesitate to contact us for advice.
How can Elite Accounting Solutions Help?
Now more than ever, the team at Elite Accounting Solutions are positioning ourselves to help business owners prepare for what is ahead of them. If you have any concerns about the income and tax implications of any recent changes, please do not hesitate to contact our office and speak with one of our Accountants.
#instant asset write off#COVID-19#ATO#Car Tax Deduction#tax return 2020#New Asset