Updated 3 August 2023
The Federal Government's instant asset write-off scheme continues to offer farmers and rural businesses major incentives to invest in assets which will improve productivity for the rural sector.

The Scheme was expanded from $30,000 to $150,000 in March 2020, to support businesses as part of the Federal Governments' Economic Stimulus Package in response to COVID-19. It has been extended indefinitely and includes:

• an increase in the threshold for each asset from $30,000 to $150,000,
• an expanded eligibility to cover businesses with an aggregated turnover of less than $500 million (up from $50 million).

Businesses that meet the criteria are able to apply an instant deduction for the portion of the asset's cost that relates to business use, during the year when the asset is initially put to use or made ready for use. The option of an immediate asset write-off is applicable in the a range of scenarios. For numerous assets, provided the cost of each separate asset falls below the specified threshold.

• Applies to both brand-new and pre-owned assets.The instant write-off has made buying both new and second hand equipment very attractive.  Farmers can claim an immediate deduction for multiple assets, new or second hand, as long as each asset costs less than $150,000. 

Many farmers and rural businesses have already taken advantage of the Scheme and used the tax write off to buy new or used machinery, plant and vehicles priced within the $150,000 spending threshold. Some have been able to separate the machinery components out to ensure each item falls within the $150K cap. There is no limit to the number of equipment items a business can buy and claim against their taxable income.

Eligibility to use instant asset write-off on an asset depends on:

• your aggregated turnover (the total ordinary income of your business and that of any associated businesses)
  the date you purchased the asset
• when it was first used or installed ready for use the cost of the asset being less than the threshold.
• You are not eligible to use the instant asset write-off on an asset if your aggregated turnover is $500 million or more.
• If temporary full expensing applies to the asset, you do not apply the instant asset write-off.

If you are interested in taking advantage of the extended asset write-off scheme, please contact Ben Millar, Finance Broker, who would be happy to answer any questions you may have or provide a quick quote.