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$150k Instant Asset Write Offs – A Fact Sheet for Australian Businesses

words by Mark

Here’s a quick fact sheet to explain the instant asset write off and instant depreciation deduction initiatives included in the March 2020 Economic Stimulus Package. Both of these initiatives are available to all businesses with an annual turnover of less than $500m.

Note: although these initiatives have been superseded by temporary full expensing of depreciating assets (TFEDA) for assets acquired after October 7 2020, both have absolute relevance to assets acquired before the TFEDA came into effect.

$150,000 instant asset write off

This initiative allows businesses to instantly write off any eligible asset (e.g. vehicles, machinery) with a purchase price of $150,000 or less (excluding GST) acquired from March 12 to December 31 2020.

Here’s what you need to know:

  • Eligible assets can be new or used (including private sales).
  • The $150,000 limit is available for each individual asset, so multiple assets totalling more than $150,000 can be claimed under this arrangement.
  • There is no limit to the number of assets you can write off under this initiative.
  • Assets can be purchased outright or financed via a chattel mortgage or CHP (finance lease does not apply for this initiative)
  • Fast track (no financials) finance is available on most assets across a broad range of financiers.

Instant depreciation write off for assets over $150,000 under the backing business investment – accelerated depreciation rules

Any eligible asset with a purchase price greater than $150,000 (excluding GST) acquired from March 12 to June 30 2021 is eligible for an immediate 50% depreciation write off with the balance of the Written Down Value (WDV) depreciable under the usual ATO guidelines.

Here’s what you need to know:

  • Assets must be new, not used.
  • There is no limit to the number of assets acquired under this initiative
  • Assets can be purchased outright or financed via a chattel mortgage or CHP (finance lease is not applicable for this initiative).
  • Fast track (replacement policy) finance is available on many of these larger assets across a broad range of financiers.

You can also read the government fact sheet for clear examples of both initiatives.

Looking to take advantage of instant asset write offs?

With an average score of 4.9 out of 5 stars in over 1000 independent reviews, Finlease can arrange the right financing for your business.

Contact your local Finlease team member to secure finance approval and take advantage of the significant tax breaks available under these programs.

 

The team at Finlease is well resourced and ready to assist any clients and suppliers to put in place any finance approvals which may be needed to take advantage of the significant tax breaks available under these programs, so please feel free to contact your local Finlease team member.

To find a Finlease team member near you, please see our team at https://www.finlease.com.au/about-us/our-brokers

If you have not used Finlease before, please feel free to see what our existing clients say about us with a score of 4.9 out of 5 stars on over 1000 independent reviews https://www.productreview.com.au/listings/finlease

Mark O’Donoghue, Founder & CEO Finlease

Finlease home page

 

4.9/5 from 954 reviews