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New business instant tax write-off?

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Hello, I am looking at starting a new small business working for myself and I would require a work Ute just wanting to know if it would be eligible for the instant asset write off or not? I'm not the most savvy when I comes to tax. Kind regards Terence

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ATO Community Support

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Hi @Twestlake

 

As of 1 January 2021, the instant asset write-off threshold is $1,000. A new vehicle is going to cost a lot more than that.

 

Instead, temporary full expensing applies.

 

Under temporary full expensing, you may be able to fully depreciate a business asset you purchase. You'll need to ensure your business meets the eligibility criteria, and the asset too. You'll need to act according to the car cost limit. This limit means that if you purchase a car and it exceeds the limit, you cannot claim any part above that limit. But if the ute doesn't meet out definition of a car, then no car cost limit applies (since it's not a car).

 

Remember that you'll only be able to claim the business-use portion of the vehicle use, so you need to account for any personal use and reduce your claim by that.

 

You can read about temporary full expensing and the car cost limit on our website.

1 REPLY 1

Most helpful response

ATO Community Support

Replies 0

Hi @Twestlake

 

As of 1 January 2021, the instant asset write-off threshold is $1,000. A new vehicle is going to cost a lot more than that.

 

Instead, temporary full expensing applies.

 

Under temporary full expensing, you may be able to fully depreciate a business asset you purchase. You'll need to ensure your business meets the eligibility criteria, and the asset too. You'll need to act according to the car cost limit. This limit means that if you purchase a car and it exceeds the limit, you cannot claim any part above that limit. But if the ute doesn't meet out definition of a car, then no car cost limit applies (since it's not a car).

 

Remember that you'll only be able to claim the business-use portion of the vehicle use, so you need to account for any personal use and reduce your claim by that.

 

You can read about temporary full expensing and the car cost limit on our website.