INSTANT ASSET WRITE-OFF
The instant asset write-off is currently available to businesses with turnover of less than $50 million.
At present, it allows eligible businesses to claim an immediate tax-deduction for the cost of eligible depreciating assets valued at up to $30,000 (per asset).
The Government will temporarily expand the instant asset write-off for assets by:
• extending the deadline from 12 March 2020 to 30 June 2020
• increasing the threshold from $30,000 to $150,000, and
• expanding the businesses who can access the instant asset write-off to
It is important to note that under existing legislation, the instant asset write-off threshold will revert to $1,000 for small businesses (less than $10 million in aggregated turnover) from 1 July 2020.
IS ART INCLUDED?
Yes. Artworks are held to be depreciating assets by the ATO, which means that they qualify for the instant asset write-off measure.
During the 2020 financial year it is possible to claim a complete deduction of up to $150,000 for each artwork purchased by a small- or medium-sized business for their premises, subject to four criteria. The artwork must be:
• Capable of being moved
• Purchased with the dominant purpose of display in a business premise; and
• Not be trading stock.
Please discuss with your accountant first. However, if your home is regarded as a “business premise” for tax purposes, then you can buy art for home offices and claim the instant write off deduction. In practice, what this means is that the art becomes an expense in the month that it is incurred, and can be set off income for the month. In effect, it means that the money used to buy the art is not taxed.