Extension to instant asset write-off scheme welcomed
BUSINESS NSW has welcomed the Federal Government's action to extend the instant asset write-off scheme for Australian businesses.
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.
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Business NSW regional manager, Jane Laverty said the extended date is positive news for business with the intention of encouraging businesses to invest in equipment and technology that will support them to withstand and recover from the pandemic.
"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," she said.
"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 explained that, as restrictions lift and optimism grows, businesses can use the extended time for the scheme to aid in their implementation of their COVID-19 recovery plans.
"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.
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Adding that manufacturing businesses that have adapted to produce hand sanitiser or face masks will be able to deduct any assets they had to install.
"Most tangible assets that decline over time are eligible, including motor vehicles up to $57,581," Mrs Laverty said.
Excluded assets include trading stock items, land, non-farming buildings, and capital works.
"Accelerated depreciation is an important measure to help business invest and grow," Mrs Laverty said.
"The next seven months will provide a good opportunity for business to maximise financing opportunities and contribute back to their local community."
Mrs Laverty recommended business owners consult their trusted local financial or business adviser or the ATO before making a purchase to ensure it is eligible and that the business will benefit.
"At the end of the day, if it will help your small business and you'll be saving money, then it's seriously worth looking into," Mrs Laverty said.
For more information, visit https://www.ato.gov.au/Instantassetwriteoff
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