The government’s latest extension to the instant asset write-off (IAWO) tax concession continues the good news for small and medium businesses.
Details of the concession
In effect, there are now two overlapping asset write-off schemes in place – IAWO and ‘temporary full expensing’ – and small and medium businesses qualify for both. It means that the total cost of new assets can be written off as a tax deduction in the financial year in which they were first purchased and/or installed ready for use.
The details for the 2020-21 and 2021-22 tax years are:
IAWO – New assets costing up to $150,000 each, purchased between 1st July 2020 and 31st December 2020, can be fully written off in the current tax year if first used (or installed and ready to use) before 30th June 2021.
Temporary full expensing – New assets purchased from 7th October 2020 (i.e. after the federal budget announcement) can be fully written off in the financial year they were installed and ready to use. There is no upper limit on cost, and the concession applies until 30th June 2022.
The cost of improvements to existing assets can also be fully expensed – as well as second-hand assets if your annual turnover is under $50 million.
In simplified terms, small and medium businesses can rely on IAWO for assets purchased between 1st June and 6th October 2020, and temporary full expensing for assets purchased between 7th October 2020 and 30th June 2022.
The perfect opportunity to invest in your IT infrastructure
With new ways of working and dramatically shifting consumer behaviours, there is now a greater need than ever for businesses to overhaul their existing IT infrastructure and make sure it’s helping, not hindering, your business goals.
Keeping ageing IT infrastructure may seem like a low-cost option, however there are hidden costs which must be accounted for when doing the cost vs. benefit analysis on IT investments. Legacy IT can hamper your ability to deploy new applications, drain your IT resources time, increase the risk of downtime and loss of productivity and increase your risks of security vulnerabilities.
Studies have found as many as over 90 percent of people said that they would consider taking their business elsewhere when dealing with a company that uses outdated technology.
With the Government Incentives currently in place, there has never been a better time to upgrade. We can help you find the best solution to help you overcome your challenges and reach your business goals.
We can help with your IT refresh
There’s still time to take advantage of the Instant Asset Write Off Scheme, ending on June 30th. We can help with identifying your IT needs and aligning your business with the best fit solution. Contact us today to make sure your business takes full advantage of this limited time government incentive.