The ability for small business entities to claim an immediate deduction has been extended for another 12 months. This is for assets costing less than $20,000. Extension will be until 30 June 2019. From 1 July 2019, the immediate deduction threshold will reduce back to $1,000.

There are no limits to the number of times you can use the immediate deduction. This is assuming your cash flow supports the purchases.

If your business is registered for GST, the cost of the asset needs to be less than $20,000 after the GST credits that can be claimed by the business have been subtracted from the purchase price. If your business is not registered for GST, it is the GST inclusive amount.

Second hand goods are also deductible. However, there are a number of assets that don’t qualify for the instant asset write-off. The reason for this is because they have their own set of rules. These include horticultural plants and capital works (building construction costs etc.), among others.

Immediate deduction does not apply to purchased assets amounting to $20,000 or more, but small businesses have the ability to allocate the purchase to a pool. It can also depreciate the pool at a rate of 15% in the first year and 30% for each year thereafter.

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