Curious about The Depreciation of The Computers in The EOFY

JimmyAtGONG on 17/06/2020 - 14:08

Hi guys, just got a question about the depreciation value of the computers bought in the EOFY.
My computer is always turning dark and fan is moving crazy and battery is inflating. Got an idea to update the computer.
I am wondering when is the best time to get a new laptop now in the EOFY. I don't know exactly how the depreciation is calculated, but from the file in ATO, it has a calculation of (Device held days)/365 * base value.
If I buy the new computer before July, how much is likely to be claim as the tax refund? Or is it a better time to buy the computer after July 1st? I am not quite sure if my current laptop can hold till then.
I use the laptop a lot for my job, in working and also at home.

Thanks a lot in advance.

Computing

Comments

  • p1 ama on 17/06/2020 - 14:14
    +2

    If I buy the new computer before July, how much is likely to be claim as the tax refund?

    Well given it's about two weeks before July now, not much…

    Or is it a better time to buy the computer after July 1st? I am not quite sure if my current laptop can hold till then.

    Hardly matters at all from a tax perspective.

    • JimmyAtGONG on 17/06/2020 - 17:59

      so if I buy this item before July, I can still postpone the depreciation till next year tax refund? If so, it actually means the same refund amount totally. For laptops, the years are three years according to ato.

      • [Deactivated] on 17/06/2020 - 21:02
        -1

        No, starts when you buy it. Next year youll get a full year of depreciation. Rinse and repeat for 3-4 yrs.

  • salmon123 on 17/06/2020 - 14:16

    If I buy the new computer before July, how much is likely to be claim as the tax refund?

    If you follow the ATO calculation, then not much, because there's only 13 days left this financial year. Lots of tax agents will let it slide and claim a whole years worth of depreciation.

    Or is it a better time to buy the computer after July 1st?

    There's no difference, if you follow the ATO calculation. It's just a question of how many tax returns its spread over. Of course, if you expect your income to go up and your marginal tax rate to change, then you're better off deferring the depreciation.

    • p1 ama on 17/06/2020 - 16:09

      Lots of tax agents will let it slide and claim a whole years worth of depreciation.

      Hate to be a party pooper, but if you get audited, this will not slide.

      • salmon123 on 17/06/2020 - 16:19

        Hate to be a party pooper, but if you get audited, this will not slide.

        I know, but at least you'll have someone else to blame. Hopefully the tax agents that let it slide have good PI insurance.

        • p1 ama on 17/06/2020 - 16:54
          +3

          I know, but at least you'll have someone else to blame.

          I'm not actually sure if that will be the case. My understanding was always that even if you use a tax agent, you are still personally liable for the information they provide (at least that is what you sign). That said, I've never used a tax agent, so I might be wrong.

          • salmon123 on 17/06/2020 - 17:19

            @p1 ama:

            My understanding was always that even if you use a tax agent, you are still personally liable for the information they provide

            Yes - you would need to settle with the ATO and then pursue the tax agent for damages.

          • jimdotpud on 18/06/2020 - 09:41

            @p1 ama: 100%…. this is why I do my own. the buck stops with you, not the agent. The agent fills in the forms based on the information you give them. it's your liability not theirs.

  • whooah1979 on 17/06/2020 - 14:36
    -3

    You can get an instant 100% write-off.

    • keejoonc on 17/06/2020 - 14:57
      +1

      if you don't know what you are talking about, please don't.
      just because you saw ads on tv flaunting instant asset write off, it doesn't mean everyone is able to take advantage of it. I don't recall OP saying he has a business.

      • whooah1979 on 17/06/2020 - 15:56
        -1

        Op is asking advice on depreciation on assets. The only depreciation that comes to mind is when running an enterprise.

        • Baysew on 17/06/2020 - 16:03
          +1

          Would only be applicable if OP was Kirk or Picard.

        • keejoonc on 17/06/2020 - 16:06

          Once again, please don't talk about things you don't know about. Please explain how depreciation only applies to businesses? Individuals are able to claim deduction for depreciation as well (eg. computers used for work, depreciation relating to rental properties)

        • jimdotpud on 18/06/2020 - 09:47

          you can depreciate/deduct items that are required to perform your job or advance yourself in your chosen field:
          eg. if your job requires you to have a phone/laptop/car and your employer doesn't provide these for you, there are allowances for you to deduct or depreciate these items/portions of costs depending on their value and expected lifetime and use.
          eg. you can claim subscriptions to journals/publications for your field of expertise

          it's a complex matter which you need to research (or get tax advice) to understand what does and doesn't apply in your individual situation.

    • [Deactivated] on 17/06/2020 - 21:03

      Only if <$300

  • Bartemaus on 17/06/2020 - 17:15
    +1

    If it's under a $1,000 you can always consider placing it into a low value pool.

    https://www.ato.gov.au/Individuals/Tax-return/2019/Tax-retur…

    • JimmyAtGONG on 17/06/2020 - 18:00

      Thanks a lot. I was replacing my main tool, so it will cost more. But this information is very timely indeed. Thanks

  • fredblogs on 18/06/2020 - 13:51

    You shouldn't trust any answer here that doesn't include an ATO link.

  • Laziofogna on 18/06/2020 - 17:31

    You are worrying about peanuts.

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