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Acano Chartered Accountants Blog

Changes to the Small Business depreciation rules

Clinton Ham - Monday, July 23, 2012

From the start of the 2013 financial year the depreciation rules for small business with a turnover of less than $2,000,000 have changed.

Previously small businesses taking advantage of the Small Busines Entity concessions were able to claim an immediate deduction for assets costing less than $1000. Assets costing over that amount were required to be allocated to 'pools' with depreciation rates of 30% or 5% depending on the effective life of the asset.

Whats changed?

  • An immediate write off is now available for assets costing less than $6500 each (net of GST)
  • All asets regardless of effective life can be consolidated into a single pool and written off at a rate of 30%
  • An initial deduction of $5000 is available upon the purchase of a motor vehicle in addition to the standard pool depreciation

Tax Tip

The $6500 immediate write off is available per asset and no longer requires assets which would normally be considered as part of a set to be consolidated.

Pool balances which have depreciated to less than $6500 can now be written off in full.

Should you wish to discuss any of the above changes, please contact our office.

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