ASBFEO welcomes asset write-off scheme extension
The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, has welcomed the extension of the asset write-off scheme as well as the increase to the threshold announced by Prime Minister Scott Morrison.
As of this week, the instant asset write-off scheme will be available to small businesses until 30 June 2020 for assets purchased under $25,000 in value.
“This is good news for small businesses looking to purchase a new or second-hand asset, such as a vehicle, printer or generator.
“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," Ms Carnell said.
The small business sector represents 99 per cent of all businesses in Australia, so this measure is expected to give small businesses more opportunities to grow and thrive.
The Treasurer will introduce this legislation when Parliament resumes on 12 February 2019.
Ms Carnell says small and family businesses need to remember that this is a tax deduction, not a rebate. So they need to have sufficient profit to write off the new asset against.
“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.
The Institute of Public Accountants has also commended the government’s announcement.
The IPA chief executive officer, Andrew Conway, noted that the IPA supports any increase of the threshold, but hopes it will become a permanent feature of government policy.
“The IPA advocated for the introduction of this initiative and have continued to argue the case for the instant asset write-off to become a permanent feature of the small business tax regime and not just a ‘maybe’ come federal budget time each year,” said Mr Conway.