If you buy an asset by 30 June and it costs less than $20,000, you can write off the business portion in your 2018 tax return.
You are eligible to use simplified depreciation rules and claim an immediate deduction for the business portion of each asset (new or second hand) costing less than $20,000 if:
- you have a turnover less than $10 million (increased from $2 million on 1 July 2016), and
- the asset was first used or installed ready for use in the income year you are claiming it in.
Assets that cost $20,000 or more can’t be immediately deducted. They will continue to be deducted over time using the general small business pool. You write off the balance of this pool if the balance (before applying any other depreciation deduction) is less than $20,000 at the end of an income year.
The $20,000 threshold applied from 12 May 2015 and will reduce to $1,000 from 1 July 2018.
In the latest Federal Budget, there is a proposal to extend the $20,000 instant asset write-off threshold to 30 June 2019. This change is not law yet.
Remember, registered tax agents and BAS agents can help you with your tax.
Source – ATO