- The instant asset write off has increased to $30,000 and been extended to 30 June 2020
- Most SME owners would use the write-off to invest in a new vehicle, IT equipment or tools and machinery.
- The write-off can be claimed for multiple asset purchases.
Leading SME lender OnDeck suggests small business owners looking to take advantage of the instant asset write off need to act quickly to secure finance.
The Morrison government increased the instant asset write-off to $30k in April, expanding the legislation to include businesses with a turnover of less than $50 million – up from $10 million.
However, for business owners considering major purchases, the ability to secure finances will be essential to take advantage of the tax break.
OnDeck warns many SMEs may miss out on claiming the write-off due to an inability to secure funds. Recent research by the fintech revealed one in four small business owners had been rejected for bank finance in the past twelve months.
Federal Government figures confirm that over 350,000 businesses have taken advantage of the instant asset write‑off. Yet a far larger number – 3.4 million SMEs – stand to benefit from the new rules.
Cameron Poolman, CEO of OnDeck Australia said SMEs often need finance to purchase eligible assets, and this can be an uncertain and time-consuming process when businesses rely on bank funding.
OnDeck found 29 per cent of small business owners that had successfully secured finance said their business was negatively impacted by the time taken to secure the loan.
“With 30 June just around the corner, time really is of the essence. I urge SMEs to act fast to take advantage of the write-down. It’s not just about tax savings. It’s an opportunity to strengthen your business through increased productivity and efficiency,” said Poolman