Instant asset write-off out, full expensing in!
But aren’t they the same thing?
The key difference is that the asset cost limit of $150,000 no longer applies – there is no cost limit under the full expensing measures!
From 7.30pm AEDT on 6 October 2020 until 30 June 2022, temporary full expensing allows a deduction for:
- the business portion of the cost of new eligible depreciating assets for businesses with an aggregated turnover under $5 billion
- the business portion of the cost of eligible second-hand assets for businesses with an aggregated turnover under $50 million.
- the balance of a small business pool at the end of each income year in this period for businesses with an aggregated turnover under $10 million.
Eligible assets must be first held, and first used or installed ready for use for a taxable purpose, between 7.30pm AEDT on 6 October 2020 and 30 June 2022.
It is important to note that the car depreciation limit still exists, meaning the maximum that can be deducted for a car in 2021 is still only $59,136.
Contact our office to discuss how the new rules apply to business assets you are purchasing.
Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances
