Tax write-off incentive extended to 2023

Those looking to invest in machinery or infrastructure for their businesses will be pleased to know that the Government’s temporary full expensing scheme has been extended to June 2023, meaning they have more time to research and consider the best options for their operations.  

In the 2021-22 Federal Budget delivered last night, Treasurer Josh Frydenberg announced the extension of the popular incentive which has triggered a significant boost in machinery sales in the past 12 months since the enhanced Instant Asset Write-off measure was first introduced.

The Temporary full expensing scheme, announced in the 2020-21 Federal Budget delivered in October 2020, allows businesses with an aggregated turnover of less than $5 billion to immediately write off the full cost of new assets purchased for businesses purposes, with no limit applied on the value or number of assets.

The measure also applies to secondhand purchases but only for businesses with turnover of less than $50 million.

It allows businesses to claim an outright deduction for the cost of purchase and installation of the assets in the same year they purchased them in, instead of having to claim them over a few years.

“Over 99 per cent of businesses, employing over 11 million workers, can write off the full value of any eligible asset they purchase,” said Frydenberg in his Budget speech.

“This has seen their spending on machinery and equipment increase at the fastest rate in nearly 7 years. So tonight, we again go further.

“Announcing the extension of these measures for a further year until 30 June 2023, so a tradie can buy a new ute, a farmer a new harvester and a manufacturer expand their production line.”