Instant asset write-off extended ahead of JobKeeper review outcomes!

Posted on 11/06/2020

The Federal Government with the support of the treasury are continuing the support for small businesses Australia wide by announcing the $150,000 instant asset write-off will be extended for another six months.

Australian businesses with a yearly revenue of less than $500 million will be able to utilise the support to invest in assets that will aid their business and the wider economy as companies across the country start to reopen.  

The government predicts these actions will assist approximately 3.5 million businesses. The instant asset write-off was established to help businesses stick to prearranged investments and encourage fast tracking of investments to support economic growth in the near term.

The threshold applies on a per asset basis, meaning eligible businesses can immediately write-off multiple assets, this is contingent that each asset costs less than $150,000. Assets can be new or second hand and could include a truck for a delivery business among many other things.

Legislative alterations will be pushed through to give effect to these actions, which is estimated to have a cost to revenue of $300 million over the forward estimates period.

Furthermore, Treasurer Josh Frydenberg has confirmed the outcomes of Treasury’s wage subsidy review will be provided on 23 July 2020.

JobKeeper is legislated until September, Mr. Frydenberg highlighted that the National Cabinet’s three stage process of easing restrictions is forecasted to see 850,000 people back in work.

When asked by a journalist whether some sectors have bounced back in demand earlier than expected he pointed to construction, mining and agriculture.

“Well construction is one sector where we’re starting to see more activity. Mining has been working effectively through the crisis and again strong demand for our exports has been reflected in commodity prices. We’ve also seen agriculture be another sector,” Mr. Frydenberg said.