The Australian Government has announced various initiatives to support Australian businesses following the Coronavirus outbreak. These support measures aim to encourage a strong economic recovery following the negative impact of the Coronavirus outbreak.
Some of these measures will support over 99 per cent of Australian businesses with an aggregated annual turnover of less than $500 million, so read below how these may benefit your business during these difficult times
Increase to the Instant Asset Write-Off
The Government is increasing the instant asset write-off (IAWO) threshold from $30,000 to $150,000. This new threshold applies on a per asset basis, so eligible businesses can write-off multiple assets immediately.
Additionally, the Government has adjusted the eligibility criteria, now including businesses with an aggregated annual turnover of less than $500 million (increased from $50 million) to take advantage of the IAWO. This expanded eligibility will mean an additional 5,300 businesses will be able to access the IAWO for the first time.
These changes will be in effect until 30 June 2020, for new or second-hand assets first used or installed ready for use in this timeframe.
Backing Business Investment (BBI)
The Australian Government is introducing a time-limited 15-month investment inventive to support business investment and economic growth over the short-term, by accelerating depreciation deductions. This allows deductions of 50 per cent of the cost of an eligible asset on installations, with existing depreciation rules applying to the balance of the asset’s cost.
This initiative will be accessible to businesses with an aggregated turnover below $500 million. Eligible assets include new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997, first used or installed by 30 June 2021.
What Does This Mean for Your Business?
As the eligibility criteria for each incentive varies, they may have different impacts on your business. For most Australian businesses though, these initiatives will have a positive impact in some way – giving you a great opportunity to take advantage of the benefits they provide.
Ultimately, the initiatives put in place by the Australian Government aim to support Australian businesses by encouraging them to spend money on assets. Australian businesses will then benefit from having new assets to assist in business function, as well as being able to instantly write the asset off prior to June 30.
If you are looking to take advantage of the Australian Government initiatives and develop and new storage solution with OLP, get in contact with our team.