$20,000 Instant Asset Write Off Extended
11th May 17
A key measure in the 2017 Australian Government Budget was a revision to the accelerated depreciation allowance that allows businesses with an aggregated annual turnover less than $10 million to immediately deduct purchases of eligible assets costing less than $20,000 first used or installed ready for use by 30 June 2018.
Key Issues For The Dental Industry —
An important initiative in the 2017 Australian Government Budget that has been welcomed by the Australian Dental Industry Association (ADIA) is news the Australian Government will extend the 2015‑16 Budget measure Growing Jobs and Small Business — expanding accelerated depreciation for small businesses by twelve months to 30 June 2018 for businesses with aggregated annual turnover less than $10 million.
This measure will improve cash flow for those businesses that not only manufacture and supply dental products, but also dental practices, by encouraging them to make investments over the course of the coming financial year.
Small businesses will be able to immediately deduct purchases of eligible assets costing less than $20,000 first used or installed ready for use by 30 June 2018. Assets excluded from these depreciation rules include horticultural plants and in-house software allocated to a software development pool. In most cases specific depreciation rules apply to these excluded assets.
Assets valued at $20,000 or more (which cannot be immediately deducted) can continue to be placed into the small business simplified depreciation pool (the pool) and depreciated at 15 per cent in the first income year and 30 per cent each income year thereafter. The pool can also be immediately deducted if the balance is less than $20,000 over this period (including existing pools).
The current ‘lock out’ laws for the simplified depreciation rules (these prevent small businesses from re‑entering the simplified depreciation regime for five years if they opt out) will continue to be suspended until 30 June 2018.
The accelerated depreciation arrangements were initially made available to businesses turning over up to $2 million annually; however, that threshold was extended to $10 million when the Senate approved the first phase of the federal government’s company tax cut plans in March 2017.
From 1 July 2018, the immediate deductibility threshold and the balance at which the pool can be immediately deducted will revert back to $1,000.
This measure is estimated to have a cost to Australian Government revenue of $650.0 million over the forward estimates period.
For a detailed overview of the 2017 Australian Government Budget visit the website:
Budget Briefing —
Stakeholders from across the dental industry are encouraged to attend the 2017 ADIA Australian Government Budget Briefing that will be held on 24 May 2017 in Sydney. It will be presented by Bill Evans, the Chief Economist at Westpac. [Register Today]
Member Engagement —
On matters associated with the 2017 Australian Government Budget, the team in the ADIA national office receive advice and guidance from members serving on the ADIA-BAC Business Affairs Committee. Updates on the research are provided at the quarterly ADIA State Branch Briefings. If your business has an interest in this matter, get involved today.
Further Information —
For further information on ADIA's on matters associated with the government budget, send an email to email@example.com telephone 1300 943 094. To keep up to date follow ADIA on Facebook at www.facebook.com/dental.industry or subscribe to the Twitter feed @AusDental.
Currency Of Information & Disclaimer —
This update was issued on 11 May 2017 and please note that changes in circumstances after the publication of material or information may impact upon its accuracy and also change regulatory compliance obligations. The statements, regulatory and technical information contained herein are believed to be accurate and are provided for information purposes only. Readers are responsible for assessing its relevance and verifying the accuracy of the content. To the fullest extent permitted by law, ADIA will not be liable for any loss, damage, cost or expense incurred in relation to or arising as a result of relying on the information presented here.
This publication is available for your use under a Creative Commons Attribution 3.0 Australia licence, with the exception of the ADIA logo, images and where stated.
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