Treasury Laws Amendment (Increasing and Extending the Instant Asset Write-Off) Act 2019 (51 of 2019)

Schedule 2   Extending the instant asset write-off to medium sized businesses

Income Tax Assessment Act 1997

2   After section 40-80

Insert:

40-82 Assets costing less than $30,000 - medium sized businesses - income years ending between 2 April 2019 and 30 June 2020

Year in which asset first used, or installed ready for use, for a taxable purpose

(1) The decline in value of a *depreciating asset you *hold for the income year (the current year ) in which you start to use the asset, or have it *installed ready for use, for a *taxable purpose is the amount worked out under subsection (2) if:

(a) you are an entity covered by subsection (4) (about medium sized businesses) for the current year and for the income year in which you started to hold the asset; and

(b) you first acquired the asset in the period beginning at 7.30 pm, by legal time in the Australian Capital Territory, on 2 April 2019 and ending on 30 June 2020; and

(c) the current year ends:

(i) on or after 2 April 2019; and

(ii) on or before 30 June 2020; and

(d) the asset is a depreciating asset whose *cost as at the end of the current year is less than $30,000.

Note: The amount you can deduct may be reduced by other provisions, such as subsection 40-25(2) (about taxable purpose) and section 40-215 (about double deductions).

(2) The amount is:

(a) unless paragraph (b) applies - the asset's *cost as at the end of the current year; or

(b) if the asset's *start time occurred in an earlier income year - the sum of the asset's *opening adjustable value for the current year and any amount included in the second element of its cost for the current year.

Later year

(3) The decline in value of a *depreciating asset you *hold for an income year (the later year ) is the first amount included in the second element of the asset's *cost for the later year if:

(a) you are an entity covered by subsection (4) (about medium sized businesses) for the later year; and

(b) the amount so included is less than $30,000; and

(c) you worked out the decline in value of the asset for an earlier income year under subsection (1); and

(d) the later year ends:

(i) on or after 2 April 2019; and

(ii) on or before 30 June 2020.

Note: The amount you can deduct may be reduced by other provisions, such as subsection 40-25(2) (about taxable purpose) and section 40-215 (about double deductions).

Medium sized business

(4) An entity is covered by this subsection for an income year if:

(a) the entity is not a *small business entity for the income year; and

(b) the entity would be a small business entity for the income year if:

(i) each reference in Subdivision 328-C (about what is a small business entity) to $10 million were instead a reference to $50 million; and

(ii) the reference in paragraph 328-110(5)(b) to a small business entity were instead a reference to an entity covered by this subsection.

Years ending after 30 June 2020

(5) For an income year ending after 30 June 2020, the asset's decline in value is worked out under the other provisions of this Division.


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