Small business tax break gets a lift
May 21, 2009
The Federal Government has provided another boost to its Small Business and General Business Tax Break, with firms now able to claim a bonus tax deduction of 50 per cent - up from 30 per cent previously of the cost of eligible assets acquired between 13 December 2008 and 31 December 2009 (and installed by 31 December 2010).
“The increased Tax Break provides small businesses with an even greater incentive to invest in new capital items, such as computer hardware and business vehicles, and to make capital improvements to existing machinery and equipment,” Treasurer Wayne Swan said last week.
The expanded Tax Break will be available to small businesses with a turnover of less than $2 million.
All other businesses can continue to access the Tax Break at 30 per cent for eligible assets contracted for prior to 30 June 2009 and 10 per cent for eligible assets that they commit to investing in between 1 July 2009 and 31 December 2009.
Small businesses need to invest a minimum of $1,000 per asset in order to qualify for the Tax Break. Under enhancements announced in March 2009, they can also merge their expenditure on batches and sets of assets in order to meet this threshold.
Legislation still needs to be passed through Parliament, but the Opposition has suggested they will support the Bill.