Australia has more than 3 million small businesses. They are the lifeblood of the Australian economy employing around 5.5 million people and providing the goods and services Aussies need.

If you’re a small business you can claim an instant asset write off of $20,000 per asset item purchased (new or used). The instant asset write-off threshold was increased from $1,000 to $20,000 in 2015 and allows you to immediately deduct the business use portion of a depreciating asset that costs less than $20,000. The deduction is applicable on a per asset basis so there is no limit to the number of claimable items each under $20,000. Assets that cost more than $20,000 (which cannot be immediately deducted) will continue to be deducted over time using a small business pool.

You can claim the write off even if you finance the asset. However be mindful that you must own the asset so a chattel mortgage type loan structure is best. Rental and Hire Purchase finance arrangements do not apply as you do not own the asset during the finance period.

Recent changes to the government’s definition of small business from an annual turnover of $2m to $10m now means more businesses can claim the instant asset write off.  However, the $20,000 write off limit will cease on 30/6/17 – so you only have a number of weeks left to take advantage of this benefit.