Delivering support for business investment

Increasing the instant asset write off
From 12 March 2020, the Federal Government increased the instant asset write off (IAWO) threshold from $30,000 to $150,000 and expanded access to include all businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020. In 2017-18 there were more than 360,000 businesses that benefited from the IAWO, claiming deductions to the value of over $4 billion.  

On 9 June 2020, the Government announced it would extend the $150,000 instant asset write-off by six months until 31 December 2020 to give eligible businesses additional time to invest. This extension has been legislated.

Backing business investment (BBI)
The Federal Government is introducing a time limited 15 month investment incentive to support business investment and economic growth over the short-term, by accelerating depreciation deductions.  
The key features of the incentive are:

  • benefit — deduction of 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost;
  • eligible businesses — businesses with aggregated turnover below $500 million; and
  • eligible assets — new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997 (that is, plant, equipment and specified intangible assets, such as patents) acquired after announcement and first used or installed by 30 June 2021. Does not apply to second-hand Division 40 assets, or buildings and other capital works depreciable under Division 43.

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