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How To Unlock A $20,000 Tax Deduction

Business Information for Australian Customers 

Australian Small Business Can Unlock A $20,000 Tax Deduction

Invest $20,000 & "Instantly" Claim Is Back

As the end of financial year approaches small businesses often look to ways for legitimate tax breaks. 

The $20,000 “instant” asset write-off scheme is a little ripper. Known as the end of financial year instant asset tax write-off it means you may be able to buy equipment for your business up to $20,000. 

You may then claim it immediately as a deduction.

instand tax write off

A survey by Officeworks and H&R Block as reported in Smart Company discovered that more than 60% of businesses aren't fully utilizing it due to a lack of knowledge about the scheme and a lack of funds available. 

For Australian small businesses this is an opportunity to purchase work-related equipment and write it off in one go. 

Rather than having to depreciated it across a number of years.

This scheme enables companies to invest in new laser tag equipment, valued up to $20,000 and decrease their taxable income by the same amount. (Okay, okay it doesn't HAVE to be laser tag equipment!! ;-) But this is a terrific opportunity to renew your arsenal. If you are interested in ordering please email us!). The new business assets can include:

  • Work vehicles
  • Tradie tools and machinery
  • IT hardware (desktop computers, printers, photocopiers)
  • Office, studio and shop furniture and fitting
  • Equipment storage (sheds and storage containers)
  • Kitchen equipment
  • Signage
  • Air conditioners or Solar panels
  • Other items (speak to your accountant as to what is eligible).

Which Businesses Are Eligible?

If your business has a turnover of less than $10 million per year then you can claim the $20,000 tax deduction. 

But the invoice needs to be dated before June 30th 2023 for you to submit your tax return for the 2022-2023 financial year in July or shortly thereafter. Check with your local Accountant to see if this $20,000 kick-back is right for your business. 

Where to Get The Funds?

While some businesses might be able to fund the new asset purchase most small businesses will need financing so the investment doesn't impact on day-to-day cash flow. Many small businesses have worked with Flexirent to secure a loan for the purchase of new laser tag equipment. 

MYOB now also offers a finance service called Ondeck so MYOB customers can apply for loans starting at $10,000. 

If you are a battlefield operator who is considering investing in new laser tag equipment then it might be worthwhile investigating the $20,000 tax write off before the end of financial year. 

$20K Tax Deduction - Summing Up

This turbocharged version of the instant asset write-off scheme was slated to expire on 30 June 2023, with its demise widely seen as the end of pandemic-era tax breaks designed to foster spending.Instead the scheme will continue.

Small businesses with an annual turnover under $10 million will be free to deduct the full cost of business upgrades and resources costing less than $20,000, so long as those purchases are installed and ready for use between July 1, 2023, and June 30, 2024.

The $20,000 threshold will operate on a per-asset basis, the budget papers add, meaning “small businesses can instantly write off multiple assets.” Read more about this at Smart Company.