13th May 2020

COVID-19: New opportunities to maximise returns through tax depreciation

In its continued response in assisting businesses navigate the challenges of COVID-19, the Australian Government has introduced key legislation that will provide increased returns to property owners through tax depreciation.

As a guide, we outline a brief summary to assist you.  The following legislative changes relate to businesses only, including entities which own property – and this applies to commercial, residential or other types of property.

PART 1

  • From 12 March 2020 until 30 June 2020 the instant asset write-off for plant and equipment will be increased from $30,000 to $150,000. This means that any asset purchased for less than $150,000 during this period will be able to be claimed in full as a tax deduction during the 2019 / 2020 financial year.
  • This write off is available to all businesses turning over less than $500M (up from $50M).

PART 2

  • From 12 March 2020 to 30 June 2021 the ‘backing business investment measure’ provides a time limited, 15 month, incentive to support businesses and increase economic activity and growth.
  • These measures include a 50% tax deduction of the cost or opening adjustable value of an eligible asset on installation. Existing depreciation rules then apply after the time limit is over.
  • If the business is using the simplified depreciation rules available to small businesses, then they can claim 57.5% of the cost in the first year and the balance is added to the small business pool to continue depreciating.
  • Businesses turning over less than $500M are eligible for these measures as well.
  • Eligible assets include items of plant, equipment and specified intangible assets. In property that could be air conditioning systems, window furnishings, floor coverings such as carpet or vinyl, kitchen appliances etc.

Acumentis offer Quantity Surveying services including tax depreciation and insurance valuation nationally with an extensive geographical footprint throughout metropolitan and regional areas of Australia. 

We are here to assist you maximise your financial returns and importantly to provide peace of mind during this difficult time.  

To understand what these changes will mean for your business, call the experienced tax depreciation team at Acumentis on 1300 882 401 for a no-obligation discussion.

To keep you informed, we will continue to share insights on the impact Coronavirus is having across various sectors of the property market via our video series over the coming weeks.

View recent COVID-19 Conversations with Acumentis here.