In the wake of the Coronavirus pandemic and the impact it is having on the economy, the Australian Government has announced that they will provide a $17.6b stimulus package that includes benefits to small-to-medium businesses to boost spending.
The Instant Asset Write Off
The instant asset write off has been expanded. Key points:
- Threshold is now $150,000 (previously $30,000)
- Access expanded to businesses with turnover $500 million or less (previously $50 million)
- Available from 12th March 2020 to 30 June 2020
- Assets must be purchased and ready for use within this period to be eligible
- Asset can be new or used
Eligible businesses can immediately write-off multiple assets as the threshold applies on a per asset basis. This allows your business to claim an upfront deduction for depreciating assets this financial year.
This will only apply until the end of this financial year so if you’re looking to fund a new asset then it is worthwhile to get in now to take advantage of this benefit.
Accelerated Depreciation Deductions
Accelerated depreciation deductions will apply for any assets that are outside of the instant asset write off threshold.
Businesses with a turnover of $500 million or less can deduct 50% of the cost of the asset in the year of purchase. This is in addition to the normal depreciation deductions that apply.
This deduction encapsulates all asset purchases over & above the $150,000 already covered in the instant write off.
The accelerated depreciation will be available from 12 March 2020 to 30 June 2021 and will bring forward deductions that would otherwise be claimed in later years.
Note: Only applicable for new asset purchases.
Cashflow Assistance for Employers
Additionally, there is cashflow assistance available for SME’s with turnover of less than $50 million that employ workers to cover the costs of employee wages and salaries.
Eligible businesses may access up to $25,000 in cash benefits that will be offset against PAYGW obligations.
To take advantage of the stimulus you will need to act quick, the cut off for the instant asset write-off is 30th June 2020. Contact a lending advisor from Partners Wealth Group today on 1800 333 143 to see how we can assist with getting your approval in place.