Federal Government Investment Allowance

Article added: 20/05/09 

The 'Small Business & General Business Tax Break' Bill was passed by both houses of Parliament on Thursday 14 of May.

Eligibility for the Investment Allowance is based on the turnover of the business acquiring the asset.

Provided all of the eligiblity criteria are satisfied, you can claim the Investment Allowance as a tax deduction in your income tax return for the income year in which you start to use an elilgible asset or have it installed ready for use. The Investment Allowance provides a bonus tax deduction - it is not a rebate or a refundable tax offset.

Additional information will be made available as it comes to hand. For more information or queries please contact us on 1300 CREDIT (1300 273 348).

Businesses with turnover $2 million or greater

Benefit 1: Customers can claim an additional 30% tax deduction on equipment acquired between 13 December 2008 and 30 June 2009 and delivered / installed before 30 June 2010.

Benefit 2: For eligible assets that are acquired from 1 July 2009 to 31 December 2009, businesses can claim an additional 10% deduction where the goods are received by 31 December 2010.

Please Note: Businesses with an annual turnover of $2m or greater can only claim on equipment costing $10,000 or above.

For more information or queries please contact us on 1300 CREDIT (1300 273 348).

Businesses with turnover of less than $2 million

Benefit 1: Customers can claim an additional 50% tax deduction on equipment purchased between 13 December 2008 and 31 December 2009 and delivered / installed before 31 December 2010.

Please Note: Businesses with an annual turnover of $2M can only claim on equipment costing $1,000 or above.

For more information or queries please contact us on 1300 CREDIT (1300 273 348).

Funding Treatments

1. Commercial Loan (CLA) / Chattel Mortgage - There is no impact to CLA facilities as title to the goods is passed to the customer at purchase.

2. Commercial Hire Purchase - As the borrower is considered to be the owner for tax depreciation purposes they are entitled to lodge a cliam for any IA benefit.

3. Finance Lease -As the owner of the asset the bank currently claims depreciation. The Bill confirms that a financier has the ability to claim the additional Investment Allowance. Where a Finance Lease is requested a benefit will be passed to the customer in the form of a lower interest rate and rentals.

For more information or queries please contact us on 1300 CREDIT (1300 273 348).