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​FAQ: The instant $20,000 asset tax write-off

Wednesday, March 9, 2016

Last year’s budget for small businesses served up the short-term instant asset tax write-off up to $20,000 (increased from the $1,000 threshold).

What is it?

The temporary accelerated depreciation write-off allows Australian small businesses to immediately deduct the business portion of each asset purchased up to $20,000. The rule applies to each individual asset purchased and is designed to encourage small businesses to invest in assets and grow their business.

When can I claim the deduction?

This deduction applies for assets purchased between 7.30pm 12 May 2015 and 30 June 2017. It can be claimed in a tax return, during the year the asset was installed or first used.

What happens on 1 July 2017?

The instant $20,000 asset write-off will revert back to the $1,000 threshold.

Who can claim the deduction?

Small businesses – that is, businesses with an annual turnover of less than $2 million.

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