$150,000 Instant Asset Write-Off ends 30 June 2023!

June 1, 2023

Claim temporary full expensing this End of Financial Year
Purchase your IT hardware now before the temporary full expensing instant asset write-off for eligible assets valued up to $150,000 ends on the 30th of June 2023.

Purchase your IT hardware now to claim temporary full expensing before the End of Financial Year

As the End of Financial Year (EOFY) approaches, it’s the perfect time to take stock of your existing IT hardware and assess if you need to make any purchases.

This is because the temporary full expensing incentives introduced by the Australian Government in 2020 to stimulate business investment and drive economic growth during the pandemic will end on the 30th of June 2023.

Now is the perfect time to purchase and install qualifying assets to claim a full deduction for the cost back in the same financial year when you complete your 2022/2023 tax return.

Temporary full expensing deductions explained

Temporary full expensing allows eligible business owners to claim an immediate deduction (instant write-off) for the business portion of the cost of an asset in the year it’s installed and ready for use for taxable purposes, rather than deducting the asset over several years.

The incentive was introduced on the 6th of October 2020, to encourage business owners to invest in assets such as new equipment, machinery and technology. It was put into place to boost previous instant asset write-off incentives introduced in 2015 and applies to a broader range of assets.

Who is eligible to claim temporary full expensing this EOFY?

To be eligible for the temporary full expensing tax incentive and claim an instant write-off on IT hardware assets when you complete a tax return for your business from June 30, 2023, the business must be one of the following:

  • A business with an aggregated turnover of less than $5 billion
  • A corporate tax entity that meets the Australian Tax Office (ATO)’s alternative income test

For the 2020-21, 2021-22 and 2022-23 income years, an eligible entity can claim a tax deduction for the business portion of the cost of:

  • Eligible new assets first held, first used or installed ready for use for a taxable purpose between 7.30pm AEDT on 6 October 2020 and 30 June 2023, for example a brand-new computer, monitor, server or printer for your business
  • Eligible second-hand assets where both the asset was first held, first used or installed ready for use for a taxable purpose between 7.30pm AEDT on 6 October 2020 and 30 June 2023 and the eligible entity’s aggregated turnover is less than $50 million. For example, a second-hand desktop or laptop computer or printer for your business
  • Improvements to existing assets incurred between 7.30pm AEDT on 6 October 2020 and 30 June 2023 to eligible assets. For example, a brand-new hard drive or additional memory installed in an existing computer

What happens from 1 July 2023 when temporary expensing ends?

From the 1st of July 2023, temporary full expensing instant asset write-off deductions will conclude. Instead, the Australian government have announced the following measures will be put in place as per the 2023-2024 budget:

  • Small businesses with an aggregated turnover of less than 10 million will be able to claim an instant asset write-off on assets which cost less than $20,000 that are first used or ready to use between 1 July 2023 and 30 June 2024.
  • For all other businesses, no instant asset write-off will apply and reverts to items with a cost threshold of $1,000 for the first time since the 12th of May 2015. For all other items over this threshold, assets must be depreciated over their effective lives

It’s important to be aware: these are significant reductions in the value of assets able to be written off, which under temporary full expensing allowed eligible businesses to immediately deduct qualifying depreciating assets up to the value of $150,000.

Enlist expert financial advice before you claim temporary full expensing or instant asset write-offs

When purchasing new IT hardware assets, Adept IT Solutions always recommend you seek additional advice from a reputable accountant and consult with the ATO to ensure your business meets the criteria outlined and the asset is eligible to be claimed under the temporary full expensing incentives correctly and accurately at the EOFY.

You can read more about temporary full expensing here.

Five reasons to take stock of your IT hardware this end of financial year

Here’s five reasons why Adept IT Solutions recommend you take stock of the IT hardware and equipment you use in your business:

  1. You can potentially avoid the need to invest in repairs or hardware replacements in the near future.
  2. Newer hardware devices and systems can help to mitigate and provide an extra layer of protection against cyber security threats in line with the Australian Cyber Security Centre (ACSC) and the Australian Signals Directorate (ASD) Essential Eight cyber securities strategies.
  3. Upgrading your IT hardware can ensure your business stays up to date with the latest server operating systems, for example updating from Windows 2012 and 2012 R2 servers. Newer operating systems and hardware will ensure you have access to the latest features available on the market so your business can remain efficient and reliable.
  4. It’s important to take stock of equipment to ensure your business is positioned to keep up with growth in staff numbers both in the office and for those who work remotely. By the same extent, it can allow Adept IT Solutions to help you securely decommission and retire systems no longer required due to dated technology or staff offboarding should this be required.
  5. By upgrading your IT system, you can prevent system down time. For example, you might consider upgrading to a cloud-based solution as the ATO will cover expenses for cloud ERP systems up to a limit of $100,000 in expenditure per year for purchases made from 7:30 pm AEDT 29 March 2022 until 30 June 2023.

How can Adept IT Solutions assist with your End of Financial Year hardware purchases?

With the End of Financial Year not far away, now is the time to place your orders.

Adept IT Solutions’ online shop provides 10’s of thousands of products ready for shipping.
If you would like direct access to the shop, kindly email sales@adept-it.com.au and one of our friendly Sales team will be able to assist you further.

To speak to a member of our team and make an order today, please email sales@adept-it.com.au or contact the office on 1300 4 23378 (ADEPT).

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