To stimulate business investment and spending in the Australian economy, the government has extended the $150,000 asset write-off until 31 December 2020. The additional six months will allow businesses more breathing room to take advantage of this benefit.
The move will be legislated, and forward estimates say it will cost $300 million in revenue. This extension comes after the government increased the write-off cap to $150,000, with businesses of a $500 million turnover or less being eligible.
As we settle into our new COVID-19 present world, there has been dramatic slumps in spending of all categories, with business investment being no different. Bureau of Statistics data showed a fall of 23% in the March quarter for non-mining investment, with a fall of 21% in plant and equipment, and a 25% fall for buildings and equipment.
The goal of the extension is to provide more opportunity essentially for businesses. Combatting those affects by delays in supply chains and those who suffered immediate reactions from the pandemic.
When speaking with Capita Finance General Manager, Gill McLean, Mrs McLean explained that “this extension and opportunity will allow more businesses to take advantage and bring forward their tax deductions. With many able to write off a number of assets at once with the increased cap”. This opens many doors for business owners and provides possibility to continue to invest in businesses and their futures. Mrs McLean added that “as a local broking business, Capita Finance and our brokers are very aware of our local market conditions and how WA is reacting. We are here to support our community and provide guidance and support tailored to the client”.
Capita continues to move from stride-to-stride and working proactively and supportively to assist personal finance clients and commercial finance clients alike. Our team has exceptional knowledge on best practices for the conditions we are currently experiencing, as well as offer a holistic approach to your personal or corporate wealth.
It is important to continue to explore this opportunity and seek out the right advice before making any capital purchases. Speak with our team and we can work together to ensure you gain the best benefit your business.