Hey guys,
Wanted to check how this $20000 write off work and is it there?
I have a small courier company and turnover is less than $2mil
I am thinking to buy a ute(purely for business)
Utes I am looking for is about $11000
How much of write off amount am I looking at this year as you can instantly write off the whole ute.
Thanks in advance
I am fairly sure OP does not mean, actually crash and write off the car. I think OP means claim a tax deduction for a vehicle purchased for business use.
He does say he wants to write off the whole Ute …ROTFLMAO
@ firedragon
I am sure I know what he means, hence I gave him a link to meaningful answers.
The double meaning was listed as a BTW as it was funny. ie LOL meaning laughing! At least Nocure understands :)
Simply, you can claim the purchase of plant & equipment, in full, as long as the net cost (less GST) is $20,000 or less.
So with your ute, you would claim back the $1,000 GST, and claim 100% of the remaining $10,000 as a depreciation expense.
This is assuming it passes in Government, but if it does, purchases from announcement date will be included.
It will pass IMO.
It is already passed. It is effective from Budget Night until June 2017.
Haven't seen any announcements, got a link?
http://www.business.gov.au/small-business/Pages/jobs-and-sma…
https://www.ato.gov.au/general/new-legislation/in-detail/dir…
The first post by Rocky Racoon also had a link.
It is not a change in the law, it is a change in the tax rules, so it is effective from the date of the budget.
In the ATO link you posted:
Is the measure law yet?
No. The law to give effect to the changes has not been enacted. This page will be updated as the measure progresses through the parliamentary process.
From the link rocky posted:
That is important for businesses to remember. The change to a $20,000 write-off is at the moment an announcement only. There is no legislation for it yet. Legislation will need to be introduced and passed through Parliament.
As this law change will be retrospective if enacted, it is important that small businesses understand their obligations under both the existing and proposed laws.
Nice idea to bring forward capex depreciation from future years, much better than the Plasma handout from Rudd. However I doubt it will save the country from a recession. He'd need to buy a new car to have any chance in saving us, and capex is more likely to prop up imports than the local economy?
Just be aware (what my accountant told me) is that if you decide to do this, your accountant will change your depreciation method to the pooled method instead of the standard individual depreciation method - although you may already be under this method anyway
Are small businesses that fall under the PSI rules - eg an IT contractor with own company - able to access this too?
In the past I think PSI rules have prevented such companies from getting small business benefits.
Unfortunately not, PSI excludes you from the Small Business concessions.
Thanks everyone for explaining
Businesses are hunting around for things to buy just under 20K. Just negotiated the sale of two cars. Little haggling because they know they are saving tax.
A mate has just sold his commercial photocopier and upgraded his own.
Opportunities for all!
I think this will explain it far better than I can
http://www.smartcompany.com.au/finance/tax/47014-sme-20-000-…
BTW "writing off" a ute may mean you will need insurance…. LOL (write off = crash)