48 Small business entity simplified depreciation


New laws have passed that allow small businesses to claim an immediate deduction for assets they first acquire and start to use, or have installed ready for use, provided each depreciable asset costs less than $20,000. This will temporarily replace the previous instant asset write-off threshold of $1,000.

The balance of the general small business pool is also immediately deductible if the balance is less than $20,000 at the end of an income year that ends on or after 12 May 2015 and on or before 30 June 2017 (including existing general small business pool).

The 'lock out' laws have also been suspended for the simplified depreciation rules (these prevent small businesses from re-entering the simplified depreciation regime for five years if they have opted out) until the end of 30 June 2017.

Only complete this item if the partnership is a small business entity using the simplified depreciation rules.

To complete this item, use the amounts calculated for small business entity depreciation deductions at K item 5.

  • Show at A the total amount claimed as a deduction for low-cost assets
  • Show at B the total amount claimed as a deduction for general small business pool assets.

Only put the depreciation deduction in the two small business entity depreciating asset labels, and not the pool balance.

Last modified: 10 Aug 2016QC 48217