There have been changes to the instant asset write-off.


Using the simplified depreciation rules, assets costing less than the relevant instant asset write-off threshold are written off in the year they are first used or installed ready-for-use. This threshold applies to each asset irrespective of whether the asset is purchased new or second-hand.


So, in simple language what does this all mean?


If your assets cost less than the relevant instant write off, are written off in the year they are first used, or installed for use, immediately. This applies to newly purchased assets or second-hand assets.


Timing


An asset must be first bought and used or installed ready-for-use in the year you claim the deduction under the simplified depreciation rules.


Example: A trailer that was purchased and stored in the shed but not yet fitted out for the intended business purpose would not be eligible.


Leslie is a florist and her business required a new van to help expand her deliveries. Leslie purchased a van for $22,500, which was paid for on 23 January 2019. Under the terms of the contract, delivery for the van was on 30 January 2019. The van was not ready for use until after the 29 January 2019 when the threshold increased to $25,000. Leslie is able to claim the entire cost of the van as part of the instant asset write-off in her 2019 income tax return. If the van had been delivered before 29 January 2019 and she started to use it at the time of delivery, Leslie would not have been able to immediately write-off the van.


If you are a small business (with a turnover of less than $10 million) (by turnover, we mean aggregated turnover, you can immediately deduct the business portion of most assets that each cost less than $30,000 if they are first used or installed ready for use from 7.30pm (AEDT) 2 April 2019 to 30 June 2020.


So, in simple language what does this all mean?


If you're a small business with a turnover of less than $10million, you can immediately deduct the business portion of most assets, IF they are used or installed ready to use - between dates 2 APRIL 2019 to 30 JUNE 2020. 


 


Cost


The cost of an asset includes both the amount you paid for it and any additional amounts you spent on transporting and installing it ready for use. The cost also includes amounts you spent on improving the asset. If you are registered for the goods and services tax (GST), you exclude the GST amount you paid on the asset when you calculate your depreciation amounts (and your instant asset write-off threshold is exclusive of any GST). This is because you will claim as a credit the GST paid in your activity statement for the relevant period. Our examples assume your business is registered for GST and unless otherwise stated, the GST has already been excluded.



So in simple language, what does this all mean?


Those assets, the fridges, the expensive Commerical Catering Equipment can be written OFF in the first year you installed them. And you can purchase NEW equipment again during this FINANCIAL YEAR.




For ALL your COMMERICAL CATERING NEW EQUIPMENT requirements,


please contact NICO or OLIVER 1300 368 911