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SBE Capital Expenditure Concessions

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In the May 2017 Federal Budget, the $20,000 immediate write-off tax concession was extended by another year, so whilst being available for 2017 as legislated the previous year, it is also available in 2018.

This means that if you need capital items and they have a cost of less than $20,000 (net of GST), then they can be deducted against your income 100% in 2018, not depreciated and that expense claim spread over the following 4 or 5 years.The $20,000 claim is not limited to 1 item per SBE taxpayer, so you could buy 3 x $15,000 assets and all would qualify for immediate deduction.

The claim of $20,000 is net of GST, so if you pay $21,990 for an item from a GST registered seller, then the price net of GST would be $19,991 and would qualify. If you bought the same item from an unregistered seller (not registered for GST) then there is no GST claim and the net cost would be $21,990 and would not qualify for the immediate write-off concession, so be careful of this technicality if purchasing just over $20,000.

The concession also does not require the asset to be brand new, so applies equally for new and second hand assets purchased.

So if you need to acquire assets below this claim threshold, make sure the item is acquired by 30 June 2018. We will remind you again when tax planning between April and June 2018, but if any items need to be ordered and there are delivery delays, then get in early to ensure the purchase satisfies the conditions.

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