One of the announcements in the Federal Budget was the deductibility of assets of less than $20,000. But please be warned that this has not been legislated as yet – so you might want to wait before getting your credit card out and going on a shopping extravaganza for your business.
If this legislation is passed it will be retrospective from 7:30pm on the 12 May 2015, so some retailers may be encouraging you to spend up big now. As with any proposed law changes it can be prudent to wait until it has actually been passed before acting on it.
Another consideration is whether this new purchase will benefit your business. We always encourage you to speak with your accountant prior to signing any contract or parting with your credit card on major purchases. While a tax deduction is a benefit, the cash you have to spend to realise the deduction can mean overall you are no better off. We can help you determine whether a new asset purchase is the best option for your personal circumstances.
For further information from the ATO on this proposed initiative, please click here.