From the Institute of Chartered Accountants

The repeal of the following two tax measures  put in place by the previous Government will significantly affect small business owners wanting to buy assets or motor vehicles.

Small business entities are businesses with less than $2Million annual turnover. For more information on SBEs or to confirm you’re eligible for small business tax concessions, visit the ATO webpage.

• Reduction in the small business instant asset write-off threshold

From 1 January, 2014 the immediate deduction for depreciating assets for small business entities (SBE) will reduce from $6,500 to $1,000. The assets must be used or installed ready for use prior to 1 January, 2014 to comply with the $6,500 immediate deduction
write-off.

• Repeal of accelerated depreciation for motor vehicles

The $5,000 immediate deduction for motor vehicles will also be repealed from 1 January, 2014. Once again SBEs have until 31 December, 2013 to take advantage of this deduction.

URGENT ACTION – If you were planning to buy motor vehicles of any value, or other depreciating assets worth less than $6,500, you should consider doing so before 31 December, 2013 to take advantage of the current tax measures before they are repealed. Accessing the $6,500 instant write-off, or the accelerated deduction for motor vehicles, will both significantly decrease tax payable in the current financial year!