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Asset (car) on ABN of sole trader.

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I have a job with my TFN. And I also run a consultancy using an ABN under individual/sole-trader. I bought a car in May 2020 for $15,500 and registered it as personal. But I have been using it for my consultancy work. I was recently told that if I register it for work purposes, I can do an instant write-off? Is that true? Can you suggest? What are my options? Any help will be greatly appreciated. 

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ATO Community Support

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Hi @gdswalia

 

Yes if you meet the eligibility criteria you can claim an immediate deduction for the business portion of the vehicle in the year it was first used or installed ready for use.

 

You are the business as a sole trader therefore there is no requirement to register the vehicle for work as such if its in your name. If you use the vehicle for both personal and business purposes then you need to work out the percentage its used for your business and only claim that amount.

 

Take a read through our information about the Instant asset write off and then let us know if you have further questions.

 

Ari

 

 

 

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Most helpful response

ATO Community Support

Replies 2

Hi @gdswalia

 

Yes if you meet the eligibility criteria you can claim an immediate deduction for the business portion of the vehicle in the year it was first used or installed ready for use.

 

You are the business as a sole trader therefore there is no requirement to register the vehicle for work as such if its in your name. If you use the vehicle for both personal and business purposes then you need to work out the percentage its used for your business and only claim that amount.

 

Take a read through our information about the Instant asset write off and then let us know if you have further questions.

 

Ari

 

 

 

Newbie

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Thanks for the information, @AriH . I meet the eligibility criteria. In the tax return that I filed for June 2019-May 2020, my tax agent did not tell me about this instant write-off. So we used the cents per kilometer method based on the usage during the year. Can I still do something so that I can write off the asset in the next year's tax return? Can I edit this year's return even though it's all finalized and submitted? What are my options? Your help and advice is greatly appreciated. 

ATO Community Support

Replies 0

Hi @gdswalia

 

You have 2 years from the date of your Notice of Assessment to amend your tax return. As an individual you can amend and lodge your tax return yourself online via ATO online services. If you don't have this service already you need to create a Mygov account and link to the ATO.

 

We have instructions to complete your tax return using MyTax. For the Instant asset write off you will need to complete small business entity simplified depreciation which is part of other business and professional items. The links will provide you with further information.

 

Let us know if you need further assistance.

 

Ari