Understanding the $150k Asset Write-Off – Update

Jean-Paul MollingerNews & Events

The COVID-19 Coronavirus Economic Stimulus Package Has Broadened The Range Of Equipment Eligible For The Instant Asset Write-off


June Update: The $150k Instant Asset Write Off has now been extended until 31 December 2020. See below for details.

In light of the COVID-19 Coronavirus, changes have now been made to the Instant Asset Write-off. Australian businesses can claim an immediate deduction for assets they purchase, including new and used equipment, where the cost is less than $150,000 ex. GST ($165,000 inc. GST), subject to business use. The previous threshold for this incentive was $30,000 ex. GST ($33,000 inc. GST).

This change makes the incentive applicable to an even wider range of equipment options – such as Tractors – being eligible for immediate deduction. This change applies from 12 March 2020, and was originally set to end 30 June 2020. On 9 June, however, the Government announced a six month extension until 31 December 2020.

Additionally, the instant asset write-off can now be claimed by businesses with an aggregated annual turnover of less than $500 million, up from the previous $50 million threshold.

And remember – the instant asset write off can be used as many times as you like, so long as each piece of equipment is under the $165,000 inc. GST threshold.

So what does this mean? Eligible businesses can claim an immediate deduction for new and used equipment they purchase, where the cost is less than $165,000 inc. GST. This depreciation deduction is limited to the percentage your asset is used for business. This instant asset write off applies to all kinds of assets, and can include mowers, tractors, and implements. It can even be used on trade-ins, so long as the purchase price of the asset is under the $165,000 inc. GST threshold. If you have a tax bill that you’d like to reduce, then you can get genuine savings on equipment using this incentive. Have a look at the example below:

Depending on your business, there may be benefits to using an alternate depreciation structure, and some exclusions do apply to the immediate deductibility threshold. As always, we’d recommend seeking professional advice to understand any tax benefits that would apply to your own circumstances. You should not act, or refrain from acting, upon the general information presented here without obtaining specific professional advice.

To learn more on the COVID-19 economic stimulus packages, we’d recommend visiting the Treasury website’s ‘Support for Businesses’ page. Additional responses that are in effect include the Backing Business Investment Incentive, and the Coronavirus SME Guarantee Scheme.

If you’d like to talk to KC Equipment about securing equipment under the $150k Instant Asset Write Off threshold, then please visit our contact us page for details on your local branch, or enquire online.

KC Equipment services the Agricultural, Golf, Sports, Commercial and Residential grounds care industries with a huge range of equipment from the world’s leading manufacturers, including Massey Ferguson, Iseki, Kubota, and Jacobson. With over thirty years of experience, branches in Yatala, Lismore and Murwillumbah, and a huge parts and supplier network, KC Equipment can assist you with all aspects of your operation.

KC Equipment – for everything in your shed.

For any media enquiries, contact Jean-Paul Mollinger, Marketing Coordinator, on marketing@farm-equipment.com.au

KC Equipment wishes all our fellow Australians the best for the challenges ahead. To find out the latest on our status during the COVID-19 response, please visit our Contact Us page.