Tax Saving Opportunity When Purchasing Small Business Assets

Did you know about this tax-saving opportunity on business purchases under $5,000?

Until 16th March 2021, you can write off up to $5,000 worth of assets instead of capitalising them. This means if you buy something now, you can write off the whole amount against your taxable income this year i.e. the year ending 31 March 2021.

As part of the Government’s COVID-19 recovery package, you’ve still got time to take advantage of this fantastic tax-saving opportunity.

Put simply, the rule means that you can immediately write-off any business-related assets that you buy before 17th March 2021 and cost less than $5,000 (excluding GST).

If you purchase an asset for $5,000 this equates to a potential tax saving of almost $1,400 on each qualifying asset!

So what type of purchases qualify?

As long as the item is for business purposes, you can immediately deduct its full cost and reduce your tax liability. This is instead of having to spread the cost over the life of the asset with an annual depreciation allowance.

If you would like any additional information about this tax-saving opportunity (on small business asset purchases under $5,000) please do not hesitate to contact us.