Bean Blog

Should you buy your assets now?

Should you buy your assets now?

February 26, 2021

Asset threshold lowering

What?

In response to COVID-19, the threshold for low-value assets to be deemed fully deductible upon purchase was increased to $5,000 GST exclusive as a way to stimulate the economy.  Prior to 17th March 2020, this amount was capped at $500.  The $5,000 threshold however is being reduced down to $1,000 on the 16th of March 2021.

 

What does this all mean?

If you purchase an asset before the 16th of March 2021 for $5,000, you may be able to make an immediate deduction which could save your company a total of $1,400 in tax to pay in the financial year in which it was purchased. If you purchase the same asset on the 17th of March 2021 it will have to be depreciated over its lifetime using an appropriate deprecation rate as per IR 265.

 

Should you talk to us?

If you want to discuss your options, please reach out.  Your business circumstances are unique and will impact any advice we may give you.

About Zak Glander

Zak Glander, Accountant - Giles & Liew Chartered AccountantsZak works with clients across a variety of accounting and advisory functions. He has previous commercial management accounting experience in both domestic and international freight and is passionate about streamlining processes to create efficiency. Zak is a strong believer that leveraging technology to get transactional jobs done faster is key to helping businesses move forward.

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