Small Business Asset Write-Off

Small businesses with a turnover up to $10 million will continue to be able to immediately write off expenditure up to $20,000 for a further year.

Eligible assets cost less than $20,000 first used or installed ready for use by 30 June 2018.

Only a few assets are not eligible (such as horticultural plants and in-house software).

Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the small business simplified depreciation pool (the pool) and depreciated at 15 per cent in the first income year and 30 per cent each income year thereafter. The pool can also be immediately deducted if the balance is less than $20,000 over this period (including existing pools).

The current ‘lock out’ laws for the simplified depreciation rules (these prevent small businesses from re-entering the simplified depreciation regime for five years if they opt out) will continue to be suspended until 30 June 2018. This measure will improve cash flow for small businesses, for another year.

From 1 July 2018 the immediate deductibility threshold and the balance at which the pool can be immediately be deducted will revert back to $1,000.