2016 tax return –What is news from the team at Forrestfield
In 2016 tax year, a $20,000 instant asset write-off threshold has been granted to all the small business comparing to the previous threshold of $1000, starting from7.30pm (AEST) 12 May 2015 and will end on 30 June 2017.
To eligible for an immediate deduction claim, the small business will have to fulfill the following two conditions.
- The new asset cost can not be $20,000 or more.
- The businesses start to use or have installed ready to use.
The new law also applied to the general small business pool if the balance is less than $20,000 at the end of an income year that ends on or after 12 May 2015 and on or before 30 June 2017.
However, this $20,000 immediate deduction for small business is not applicable to the assets that have already depreciating over five years under the simplified depreciation rules. Also, horticultural plants and in-house software allocated to a software development pool will be excluded from the $20,000 immediate deduction.
For assets that cost over $20,000 or more, the general small business pool will be applied by using 15% of the cost in the first income year and 30% diminishing method deduction on the opening pool balance for each income year thereafter.
If you are a small business owner that has purchased an asset under $20,000 and, was not sure if you are eligible to claim, please call and our team of qualified accountants can explain if you are able to apply this generous deduction and maximise your return for 2016.
For more information please contact us below or call us on 0436 007 039
Please note this article was written on the 3/03/2016 and was accurate on this date
