Equipment Purchases - November 2016

When you combine the current low interest rate environment with the Instant Asset Write-Off, there has rarely been a more favorable time for small businesses to invest in plant and equipment.

The Small Business Instant Asset Write-Off allows small businesses (those with a turnover of less than $2 million including the turnover of related entities) to claim an outright deduction for the full cost of business equipment purchased under $20,000 (GST-exclusive). Most equipment (new or second-hand) is eligible including motor vehicles. To claim a deduction in this financial year, the equipment must be not only purchased but also installed ready for use before 1 July 2017. From that date, the Small Business Write-Off threshold reverts back down to $1,000.


Watch This Space

Legislation is currently before the Federal Parliament to increase the Small Business Turnover Threshold from $2 million and $10 million. If this legislation passes through parliament, Treasury estimates that this change will open the way for an additional 90,000 to 100,000 businesses (i.e. those with a turnover of between $2 million and $10 million) to access the $20,000 write-off, plus a range of other Small Business Concessions. We will keep you posted on the passage of this legislation through Parliament.



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