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Re: Instant Asset Write-off - Silverado 1500

Initiate

Views 109

Replies 8

Hello,

 

I am looking to purchase a 2021 Cheverolet Silverado 1500 for work purposes. I need the ability to carry cargo - weight and volume are both important and this vehicle suits my business. Although it does not have a 1 tonne payload capacity - the payload exceeds the passenger weight using MT2024. Link here; 

 

https://www.ato.gov.au/law/view/document?Docid=MTR%2FMT2024%2FNAT%2FATO%2F00001&PiT=99991231235958&f...

 

 

Is the vehicle eligible for the instant asset write-off of $150,000?

 

Many thanks

 

JB. 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Devotee Registered Tax Practitioner

Replies 5

It would be purchsed through a company registered for GST and with aggregated turnover of less than $500 million.

 

So quaifies under:

From 7.30pm AEDT on 6 October 2020 until 30 June 2022, temporary full expensing allows a deduction for:

  • the business portion of the cost of new eligible depreciating assets for businesses with an aggregated turnover under $5 billion or for corporate tax entities that satisfy the alternative test
  • the business portion of the cost of eligible second-hand assets for businesses with an aggregated turnover under $50 million
  • the balance of a small business pool at the end of each income year in this period for businesses with an aggregated turnover under $10 million.

Companies get 100 % deduction up to whatever the limit is.

For commercial vehicles, the limit is actual cost less GST if company registered for GST.

Passenger vehicles are restricted to the car cost limit.

Private use is dealt with by FBT  -  MT2024.

 

This site explains the whole issue and has a list of DC utes that ATO classes are cars  -  the Silverado 712 kg payload is on that list.

https://www.carexpert.com.au/car-news/which-utes-and-vans-are-eligible-for-the-full-150000-instant-a....

 

 

 

8 REPLIES 8

Devotee Registered Tax Practitioner

Replies 7

Is the vehicle eligible for the instant asset write-off of $150,000?

 

Yes  -  if purchased by a company or trust.

 

Otherwise, a log book will determine the extent of the deduction.

 

MT2024 is only for FBT, not income tax deductions.

 

 

  

Initiate

Replies 6

Thanks Bruce.

 

It would be purchsed through a company registered for GST and with aggregated turnover of less than $500 million.

 

The vehicle would be purchased in February 2021 and would be used in March or April 2021.

 

Looking at the ATO website, the vehicle may be considered a passenger vehicle as it is designed to carry a load less than one tonne and fewer than 9 passengers. I'm referring to this section - link below;

 

https://www.ato.gov.au/Business/Depreciation-and-capital-expenses-and-allowances/Simpler-depreciatio...

 

The Silverado can carry 4 passengers (5 including the driver) and has a kerb weight of 2588kg. GCM is 7160kg GCM , payload is 712kg and GVM is 3300kg.

 

Is there a tax ruling I can file with regards to this? Or is there something else I can note for future accounting/auditing purposes? Maybe I have misread the instant asset writeoff.

 

Many thanks.

Most helpful response

Devotee Registered Tax Practitioner

Replies 5

It would be purchsed through a company registered for GST and with aggregated turnover of less than $500 million.

 

So quaifies under:

From 7.30pm AEDT on 6 October 2020 until 30 June 2022, temporary full expensing allows a deduction for:

  • the business portion of the cost of new eligible depreciating assets for businesses with an aggregated turnover under $5 billion or for corporate tax entities that satisfy the alternative test
  • the business portion of the cost of eligible second-hand assets for businesses with an aggregated turnover under $50 million
  • the balance of a small business pool at the end of each income year in this period for businesses with an aggregated turnover under $10 million.

Companies get 100 % deduction up to whatever the limit is.

For commercial vehicles, the limit is actual cost less GST if company registered for GST.

Passenger vehicles are restricted to the car cost limit.

Private use is dealt with by FBT  -  MT2024.

 

This site explains the whole issue and has a list of DC utes that ATO classes are cars  -  the Silverado 712 kg payload is on that list.

https://www.carexpert.com.au/car-news/which-utes-and-vans-are-eligible-for-the-full-150000-instant-a....

 

 

 

Initiate

Replies 4

Hi Bruce,

 

Many thanks.

 

That link seems to infer the Silverado would be considered a passenger vehical and says that it is ineligible for the $150k instant writeoff. Am I missing something here?

 

Thanks

 

JB

Devotee Registered Tax Practitioner

Replies 3

That link seems to infer the Silverado would be considered a passenger vehical and says that it is ineligible for the $150k instant writeoff. Am I missing something here?

 

That is how it looks to me.

 

 

Taxicorn

Replies 2

@jonboy @Bruce4Tax 

 

Also check out Redbook.com.au

 

You can find the exact year/model etc.

 

 

Initiate

Replies 1

Hi Mac,

 

How is this relevant to the question? I dont quite follow.

 

Thanks

 

JB

Taxicorn

Replies 0

@jonboy 

 

Sorry, I thought you could find the exactl model and year and it may be under 1 tonne.