The Australian Small Business and Family Enterprise Ombudsman (ASBFEO), Kate Carnell, has welcomed the announcement by the government of the extension of the $20k instant asset tax write-off.
The instant asset write-off scheme will now be extended to small businesses until 30 June 2020 with an increase to the write off to include assets purchased under $25,000 in value.
Carnell said the welcomed the extension of the scheme as well as the increase is good news for small businesses looking to purchase a new or second-hand asset in the coming year.
“The scheme allows small businesses to immediately deduct assets costing less than $25,000 instead of claiming deductions over a number of years and there is no limit on how many assets can be claimed.
“The small business sector represents 99 per cent of all businesses in Australia, so this measure will give small businesses more opportunities to grow and thrive.”
The Treasurer is expected to introduce this legislation when Parliament resumes on February 12, 2019.
While the asset write-off is welcome, Carnell suggested it is vital businesses understand this is a tax deduction, not a rebate.
“So you need to have sufficient profit to write off the new asset against,” Carnell said.
“We will be working with the government, the Australian Taxation Office, industry associations, accountants and bookkeepers to ensure small business knows about this important opportunity,” she said.