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$20,000 Accelerated Depreciation of New Assets

15th May 2017

Bring it on with tax time looming, a special read for our small business clients and friends.

Wow, only 6 weeks or so to go until June 30, time to do some tax planning before the ATO gets too good a hold on you.  Did you know that for many business asset purchases for an amount under $20,000 you can write the cost off instantly and not worry about depreciation.  And that’s not $20,000 in total, its $20,000 per purchase, and you can make as many purchases as you want – provided that you can afford it that is.  If you don’t have the cash on hand, pick up the phone and call 1800 734 346 and Debbie will connect you to an experienced business lender to assist you.

The best thing? For the last few years this has been limited to businesses with turnover of less than $2M. In last year’s budget this cap was increased to $10M turnover and this is expected to get through Parliament by the end of May.  So if you thought that you were excluded, time to think again.

There are other things that you can do now as well, such as: -

  • Utilise the accelerated depreciation of new assets over $20,000
  • Use a structured lease to make a bigger upfront payment to create a deduction
  • Pre pay the rent on your premises
  • Make a voluntary superannuation contribution – we may be able to lend you the money and if you are the right age you may be able to redeem the funds tax free
  • Pre paying bills and accounts
  • Advance purchasing business stock and consumables

In many cases an equipment finance loan can be done on a ‘no financials’ basis up to $100,000 (if it is replacing an existing like for like asset it can be up to $500,000). This makes the whole process very quick and simple to do.

But you know the drill, big disclaimer time, we are not accountants or financial planners and our advice is general in nature. It does not reflect your unique position – so go get some advice from the people that are paid to know these things.  But don’t forget to call us to sort your finances, after all we gave you the idea to call your advisors.

What are you waiting for? Get out there and talk to your accountant and financial planner NOW. There’s really not that much time left and you don’t want to miss out in the last minute rush.

About the Author

David Traynor has been in the finance industry since 1982, is a member of both FBAA and MFAA, plus the Commercial Asset Finance Brokers Association (CAFBA), David holds a Diploma in Finance and Mortgage Broking Management and has been awarded as a Fellow of Finance by FINSIA.

David established Regional Finance Solutions in 2013 when he became aware of the banks continued removal of traditional bank branch based lenders. Regional Finance Solutions currently has 17 brokers spread across the North Coast, New England and North West. Banking roles for David have been extensive and have included roles in branches through to executive management roles.