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Instant Asset write off and Temporary expensing & ATI for sole traders

Newbie

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Good morning,

 

I am trying to find out if the writing off of assets under instant asset write off and temporary expensing will affect the ATI for medicare levy surcharge, child support income, centrelink payments such as FTB, for sole traders.   I would imagine there would be an issue around this as some people may effectively reduce their income to Nil with a follow on effect of being able to "cash in" on government benefits such as single parenting payments, and Family Tax benefits and in some cases pensions which rely upon taxable income.   It will also also allow people regarded as a paying parent under CSA to artificially change their income to Nil leaving many "receiving" parents with a debt to repay.  

 

Can someone at the ATO please advise so we can advise clients as an additional matter for consideration.

 

Kind regards

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ATO Certified Response

ATO Community Support

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Hi @Agent3131

 

The instant asset write-off has been around for several years. The threshold has been considerably high for asset eligibility from 12 May 2015. Remember the instant asset write off applies per asset, not in total. Temporary full expensing follows similar ideas. It's an instant deduction for a high cost asset that normally is deducted over many years.

 

Assets deducted under the instant asset write-off or temporary full expensing rules will impact a client's taxable income the same way all deductions will.

 

We can't comment on the impact this will have on other government agency payments or provisions. These rules are brought in by the Treasury, which looks at inter-agency impacts when making decisions for the budget. If your clients have further questions about the budget's ATO measures impacts on other agencies, they should speak to that agency. Or, for questions about the why behind budget measures, they can contact the Treasury.

1 REPLY 1

Most helpful response

ATO Certified Response

ATO Community Support

Replies 0

Hi @Agent3131

 

The instant asset write-off has been around for several years. The threshold has been considerably high for asset eligibility from 12 May 2015. Remember the instant asset write off applies per asset, not in total. Temporary full expensing follows similar ideas. It's an instant deduction for a high cost asset that normally is deducted over many years.

 

Assets deducted under the instant asset write-off or temporary full expensing rules will impact a client's taxable income the same way all deductions will.

 

We can't comment on the impact this will have on other government agency payments or provisions. These rules are brought in by the Treasury, which looks at inter-agency impacts when making decisions for the budget. If your clients have further questions about the budget's ATO measures impacts on other agencies, they should speak to that agency. Or, for questions about the why behind budget measures, they can contact the Treasury.