Finance Minister Josh Frydenberg announced businesses can now write-off assets such as cars and tools for the increased value of $150,000, until the end of December. Queensland businesses are set to value from the extension on new assets which must be bought and installed by the end of the year. This scheme is aimed at supporting the economy in the recovery phase post the significant impacts felt by businesses in the wake of the COVID-19 pandemic.

“The scheme is designed to support business sticking with investment they had planned and encouraging them to bring investment forward to support economic growth over the near term” The Treasurer said.

This will be a welcome announcement as businesses suffer from reduced cash flow as the country enters a recession in the June quarter.

The Treasurer explained the measures, which form a part of the Federal Governments emergency fiscal package, are crucial to restore confidence in spending and investment.

“Assets can be new or second hand and could include for example a truck for a delivery business or a tractor for a farming business” he said.

As with other recently announced recovery schemes such as the $688m HomeBuilder package, there are several criteria that must be met in order to access the increased write off.

Businesses with an annual turnover of less than $500 million. (previously $50million) are now able to access the scheme, which is estimated to be worth a total of $1bn.

Read more on the Federal Governments website.

Source: Sydney Morning Herald | Businesses given beefed-up asset write-off

10 June 2020