Instant Asset Write Off Extended

The Government has announced that it will extend the Instant Asset Write-Off concession for another 6 months until 31 December 2020. This means eligible businesses can still claim immediate deductions for part of the 2020-21 financial year.

Depending on the aggregated turnover of the business and the date when the asset is first used or installed ready for use, the following thresholds apply from 1 July 2019 onwards:

Aggregated Turnover Date Range Threshold
< $500 million 12 March 2020 to 31 December 2020 $150,000
< $50 million 2 April 2019 to 11 March 2020 $30,000
< $10 million 29 January 2019 to 2 April 2019 $25,000

The immediate deduction is available for both new and second-hand assets. However, certain assets are specifically excluded, such as:

  • buildings and leasehold improvements that fall under the capital works deduction regime;
  • software allocated to a software development pool (but not other software);
  • horticultural plants and other certain assets used in the primary production; and
  • assets that are leased out, or expected to be leased out, for more than 50% of the time on a depreciating asset lease.

It should be noted eligible businesses acquiring cars as depreciating assets can only claim up to the car limit of $57,581 for the 2019-20 financial year. Cars in this context mean passenger vehicles (except motor cycles or similar vehicles) designed to carry a load less than one tonne and fewer than 9 passengers. However, eligible business can still claim immediate deductions for other vehicles (e.g. panel vans, utilities, trucks and machinery) that are designed to carry a load of more than 1 tonne and/or more than 8 passengers where the cost of the vehicles are less than $150,000.

If you wish to discuss any of the above further, please do not hesitate to contact Brealey Quill Kenny, Canning Vale on 9256 2777.

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