The immediate asset write-off is a deduction that eligible businesses can claim for the purchase of new or second-hand fixed assets. Examples of the type of assets that can be immediately written off include plant, vehicles, tools and office equipment.

There are three core eligibility criteria that must be met in order to access the immediate write-off:

  1. The business purchasing the asset must qualify as a small business by having an aggregated business turnover of less than
    • $10 million from 1 July 2016*
    • $2 million for previous years;
  2. The asset purchased must be used or at minimum installed ready for use in the income year the deduction is to be claimed;
  3. The asset purchase must be less than a threshold which is different subject to the date the asset was acquired, the most recent threshold being set at $30,000.

*Businesses with a turnover of less than $50 million maybe eligible for the instant asset write off for assets purchased from 2 April 2019.

Benefits of the write-off

It is important to note that the immediate write off is not a free handout.  The concept of the write-off is that you are bringing forward tax deductions you would have claimed anyway.

The benefit comes from the fact that you can claim the full deduction in year one, reducing your tax liability in that year as opposed to a reduced liability over a number of years.

It is important to remember that when considering the purchase of an asset for your business, the asset must have an immediate benefit to your business and your cashflow must be able to support the purchase.

Important dates and corresponding thresholds

Date Range Threshold per asset
7:30 pm (AEDT) 02/04/2019 to 30/06/2020 $30,000
29/01/2019 to before 7.30pm (AEDT) 02/04/2019 $25,000
7.30pm (AEST) 12/05/2015 to 28/01/2019 $20,000

 Need some help to work out your eligibility?

We have a calculator you can use to check if your asset purchase is eligible for the immediate write-off.  The information you need is:

  • Aggregated turnover
  • Asset purchase price
  • Date acquired

Enter the above information into our calculator to find out your eligibility or give us a call on 03 52216399 and speak to one of our team members.

Disclaimer: this information is of a general nature and should not be viewed as representing financial advice. Users of this information are encouraged to seek further advice if they are unclear as to the meaning of anything contained in this article. Davidsons accepts no responsibility for any loss suffered as a result of any party using or relying on this article